annual report 2018 - mitsui · publication of an integrated report in 2004, mitsui systematically...

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Integrated Report 2018MITSUI & CO., LTD.

Publication of an

Integrated Report

In 2004, Mitsui systematically and clearly set forth in writing the implicit values it

shares as common knowledge, and issued its “Mission, Vision and Values” (see page

002). To “strive to contribute to the creation of a future where the aspirations of the

people can be fulfilled,” set in Mitsui’s Mission, in 2015 we defined Five Material

Issues (Materiality) as the important issues for our management to address (see

pages 014–016). Meanwhile, in the same year, the United Nations adopted the

Sustainable Development Goals (SDGs), which lay out 17 goals and 169 targets to

end poverty, protect the planet, and ensure prosperity for all by 2030, and clearly

underline the priority issues on a global basis and ideal visions for the future.

As a trading company, we possess various functions and develop a broad range

of businesses in diverse countries and regions around the world. As our Materiality

has strong association with the SDGs, we believe that we can make wide-ranging

contributions to society through our businesses. Our diverse human resources

leverage our comprehensive strengths and global network and continuously

pursue industrial solutions to social issues.

Since 2012, we have published the Annual Report with a view to an integrated

report. The Annual Reports have introduced Mitsui’s value creation process that is

aimed at improving our corporate value continuously, our CSR activities contribut-

ing to society through our business, and so on.

We consider it important to send a clearer message from a long-term and com-

prehensive perspective about the unchanging approach of Mitsui’s management

and each employee, pursuing sustainable development for both the society and us

continuously, with the aim of creating a future where all aspirations can be fulfilled.

Accordingly, we have renewed it as Integrated Report from the fiscal year ending

March 2019.

Looking ahead, we will continue to do our utmost to ensure that the Integrated

Report serves as an effective communication tool that positively contributes to

constructive dialogue with our stakeholders. To do so, we will strive to improve

the clarity of this report based on the valued feedback we receive from our

stakeholders.

In the process, we referred to “the International Integrated Reporting Framework”

propounded by International Integrated Reporting Council (IIRC) and “the Guidance

for Collaborative Value Creation” formulated by Ministry of Economy, Trade and

Industry, in addition to other frameworks. In the course of preparing this report, we

have worked closely with each of our internal departments to provide a summary

of our holistic perspective on the Group as a whole. Through these means, I can say

with confidence that this report was created in an honest and sincere manner.

September 2018

Masami Iijima

Representative Director and Chairman of the Board of Directors

Chairman of the Governance Committee

This integrated report was completed with reference to the following guidelines:

・��GRI�(Global�Reporting�Initiative),�Sustainability Reporting Standard

・�Ministry�of�the�Environment,�Japan,�Environmental Accounting Guidelines 2005

・�ISO�26000�(Guidance on social responsibility)

・�IIRC�(International�Integrated�Reporting�Council),��

International Integrated Reporting Framework

・�Ministry�of�Economy,�Trade�and�Industry,�Japan,��

Guidance for Integrated Corporate Disclosure and �

Company-Investor Dialogues for Collaborative Value Creation

Reports ContentsMedia

Booklet PDF HTML

Integrated

Report

(This booklet)

…… [1]

For�details,�please�see�“CONTENTS”�on�page�003.

Sustainability

Report

…… [2]

The�Company�publishes�a�sustainability�report�for�

Mitsui’s�multi-stakeholders.�Published�annually,�the�

Sustainability Report�contains�detailed�non-financial�

information.�Sustainability Report 2018�was�issued�in�

August�2018.

Annual

Securities

Report

…… [3]

The�Annual�Securities�Report�is�prepared�pursuant�

to�Article�24,�Section�1�of�the�Financial�Instruments�

and�Exchange�Act�and�is�required�to�be�submitted�

to�the�Kanto�Finance�Bureau.�Please�refer�to�this�

report�for�more�detailed�financial�information.��

It�is�issued�in�late�June�of�each�year.�

Corporate

Governance

Report

In�accordance�with�Japan’s�Corporate�Governance�

Code,�the�Company�publishes�a�Corporate�

Governance�Report�that�provides�details�on�Mitsui’s�

basic�corporate�governance�approach�and�struc-

ture.�The�Company�is�also�required�to�submit�this�

report�to�the�Tokyo�Stock�Exchange.�Please�refer�to�

the�PDF�link�for�more�detailed�information�related�

to�Mitsui’s�organizational�design,�operational�status,�

and�evaluation�of�Board�of�Director�effectiveness.

Editorial Policy

About Reports

Issued by the Company

This�integrated�report��

summarizes�relevant��

information�with�a�particular�

focus�on�factors�that�impact�

Mitsui’s�corporate�value.�In�

addition�to�this�report,�the�

Company�publishes�various�

communication�tools�for�

Mitsui’s�stakeholders.

As�used�in�this�report,��

“the�Company”�is�used�to��

refer�to�Mitsui�&�Co.,�Ltd.��

(Mitsui�Bussan�Kabushiki��

Kaisha),�while�“Mitsui,”��

“the�Companies,”�“the�Group,”�

“we,”�“us,”�and�“our”�are�used��

to�indicate�Mitsui�&�Co.,�Ltd.��

and�affiliated�companies,��

unless�otherwise�understood�

from�the�context.

Recently,�there�has�been�growing�interest�in�the�United�Nations’�“Sustainable�Development��

Goals”�(SDGs)�and�in�“Environmental,�Social,�and�Governance”�(ESG)�investments.�In�this��

environment,�we�believe�it�is�important�to�clearly�convey�the�sustainable�nature�of�Mitsui’s�

businesses�and�the�potential�for�corporate�value�growth�over�the�medium�to�long�term��

through�explanations�of�the�business�risks�and�opportunities�we�identify�as�well�as�the��

strategies�and�initiatives�we�are�pursuing�to�address�them.�To�this�end,�we�have�decided�to��

turn�our�conventional�annual�report�into�an�integrated�report.�We�hope�that�this�report�can��

help�further�our�stakeholders’�understanding�of�a�general�trading�company’s�business�model,�

which�is�said�to�be�difficult�to�comprehend,�in�addition�to�the�competitiveness�of�Mitsui.

Financial�Information

Management�Information

Non-financial�Information

[3] Annual

Securities Report

[1] Integrated Report

[2] Sustainability Report

MITSUI & CO., LTD. Integrated Report 2018 001

Corporate

Management

Philosophy

There�has�always�been�a�close�relationship�between�the�growth�of�a�corporation�and�the�

development�of�society.�Going�forward,�this�relationship�will�hold�an�even�greater�significance.�

We�believe�that�we�must�continually�improve�the�way�we�engage�with�environmental�and�

societal�issues,�listen�closely�to�our�stakeholders,�and�ensure�that�we�have�a�clear�understand-

ing�of�key�concerns,�issues,�and�expectations.�It�is�then�our�responsibility�to�contribute�to�

addressing�issues�and�meeting�expectations�in�the�most�effective�way�possible.

� We�continue�to�ensure�that�all�of�our�employees�share�our�management�philosophy,��

as�expressed�in�our�Mission,�Vision�and�Values,�and�to�strengthen�our�robust�management�

platform,�including�our�governance�and�risk�management�systems.�At�the�same�time,��

working�alongside�our�stakeholders,�our�aim�is�to�pursue�business�in�a�manner�expressed��

in�our�“360°�business�innovation.”�slogan.�This�slogan�indicates�that�one�of�our�greatest�

strengths�is�our�ability�to�connect�various�ideas,�information,�customers,�partners,�and�our�

businesses.�Through�these�connections,�we�will�create�new�ideas�and�work�to�spur�business�

and�industrial�innovation�to�create�new�value�around�the�world�so�as�to�strive�to�contribute�to�

the�creation�of�a�future�where�the�aspirations�of�the�people�can�be�fulfilled.�This�is�what�Mitsui�

is�expected�to�do�and�how�Mitsui�strives�to�create�new�value�in�pursuit�of�social�sustainability.

Mitsui’s

Value Creation

MissionStrive�to�contribute�to�the�creation�of�a�future�where�the�aspirations��

of�the�people�can�be�fulfilled.

�Values•�Build�trust�with�fairness�and�humility.

•�Aspire�to�set�high�standards�and�to�contribute�to�society.

•�Embrace�the�challenge�of�continuous�innovation.

•�Foster�a�culture�of�open-mindedness.

•�Strive�to�develop�others�and�oneself�to�achieve�full�potential.

�VisionAim�to�become�a�global�business�enabler�that�can�meet�the�needs��

of�our�customers�throughout�the�world.

A better future

Recognition of environmental and societal issues

Value creation

360° business innovation.

BusinessactivitiesBusinessactivitiesBusiness associates /

Consumers Government bodies

Employees Communities

Shareholders / Investors

NPOs / NGOs

CorporateMission,

Vision andValues

Managementplatform

Managementplatform


MITSUI & CO., LTD. Integrated Report 2018

A Cautionary Note on Forward-Looking Statements:

This�Integrated�Report�contains�statements�(including�figures)�

regarding�Mitsui�&�Co.,�Ltd.�(“Mitsui”)’s�corporate�strategies,�

objectives,�and�views�of�future�developments�that�are�forward-

looking�in�nature�and�are�not�simply�reiterations�of�historical�facts.�

These�statements�are�presented�to�inform�stakeholders�of�the�views�

of�Mitsui’s�management�but�should�not�be�relied�on�solely�in�

making�investment�and�other�decisions.�You�should�be�aware�that�a�

number�of�known�or�unknown�risks,�uncertainties,�and�other�factors�

could�lead�to�outcomes�that�differ�materially�from�those�presented�

in�such�forward-looking�statements.

� These�risks,�uncertainties,�and�other�factors�referred�to�above��

include,�but�are�not�limited�to,�those�contained�in�Mitsui’s�latest��

Annual�Securities�Report�and�Quarterly�Securities�Report,�and�

Mitsui�undertakes�no�obligation�to�publicly�update�or�revise�any�

forward-looking�statements.

072� �Corporate Governance� � 074� External�Directors�Panel�Discussion

� � 078� Mitsui’s�Corporate�Governance�

� � 086� �Execution�of�Business�Activities��

and�Internal�Controls

� � 090� �Board�of�Directors�and�Independent�

Directors

� � 092� �Full-time�and�Independent�Audit�&�

Supervisory�Board�Members

� � 093� Executive�Officers

094� Fact Data� � 096� �Mitsui’s�Continuing�Evolution�by�Meeting�

the�Changing�Needs�of�the�Times

� � 098� 10-Year�Financial�Data

� � 100� Participation�in�Initiatives

� � 101� Evaluation�by�Society

� � 102� Operating�Environment�Analysis

� � 104� �Consolidated�Statements�of��

Financial�Position

� � 108� �Consolidated�Statements�of�Income��

and�Comprehensive�Income

� � 110� Consolidated�Statements�of�Cash�Flows

� � 112� Segment�Information

� � 115� �Consolidated�Statements�of�Changes��

in�Equity

� � 116� Risk�Information

� � 123� �Major�Risk�Exposure�by�Country��

and�Fund�Operation

� � 124� Investor�Information

004 CEO Message

010 Aiming for Sustainable Growth� � 012� Our�Corporate�Value�Creation�Process

� � 014� Material�Issues�of�Focus�(Materiality)

� � 017� Capitals

� � 018� �Business�Model�for�Growth�That��

Balances�between�Trading�and��

Business�Management

� � 020� �Positioning�Strategy�That�Leverages��

Our�Competitiveness

� � 022� Portfolio�Management

� � 024� Enhancing�Management�Capital�1�

� � � Human Capital �

� � � �The�individual�builds�the�business,��

and�the�business�cultivates�the�individual

� � 026� Enhancing�Management�Capital�2�

� � � Relationship Capital �

� � � �Engagement�for�business�creation�

� � 028� �Efforts�to�Address�Climate�Change�through�

Our�Business

� � 030� �Message�from�the�Chairperson��

of�the�Sustainability�Committee

032 Our Progress� � 034� Performance�Highlights

� � 036� CFO�Message

� � 042� �Progress�of�Medium-term��

Management�Plan

� � 046� �Results�of�Initiatives��

Case�1:�Establishing�Selected��

New�Growth�Areas


Case�2:�Promoting�the�Digital�

Transformation�Strategy


Case�3:�Main�Results�of�Our�Efforts��

toward�Sustainability

052 Our Business� � 054� Results�by�Operating�Segment

� � 056� Iron�&�Steel�Products�Segment

� � 058� Mineral�&�Metal�Resources�Segment

� � 060� Machinery�&�Infrastructure�Segment

� � 062� Chemicals�Segment

� � 064� Energy�Segment

� � 066� Lifestyle�Segment

� � 068� �Innovation�&�Corporate�Development�

Segment

� � 070� The�Structure�That�Supports�Mitsui


Tatsuo�YasunagaRepresentative�Director,��

President�and�Chief�Executive�Officer


We�will�strongly�push�forward�with��

the�medium-term�management�plan�with��

even�deeper�confidence�that�we�can�achieve��

the�plan’s�targets.�In�doing�so,�we�will�make��

thorough�efforts�to�further�enhance�our�earning�

power,�which�centers�on�our�competitiveness.

Looking back on the first year of

the medium-term management

plan and outlook for the fiscal

year ending March 31, 2019

In�the�fiscal�year�ended�March�31,�2018,��

the�first�year�of�the�current�medium-term��

management�plan,�Mitsui�made�very��

significant�progress,�enhancing�base�profit��

in�all�segments�by�achieving�solid�results��

in�each�of�our�key�initiatives�and�tackling��

specific�areas�of�concern.�We�achieved�a��

record�high�in�core�operating�cash�flow,��

Mitsui’s�most�important�indicator,�and�made�

steady�progress�in�strengthening�our�financial�

base�by�improving�capital�efficiency,�rep-

resented�by�ROE,�while�reducing�Net�DER.��

Shareholder�returns,�in�the�form�of�dividends�

and�share�buybacks,�totaled�¥172.5�billion�and�

were�the�highest�ever�by�Mitsui.

� In�the�fiscal�year�ending�March�31,�2019,�the�

second�year�of�our�medium-term�management�

plan,�we�are�targeting�profit�after�tax�of�¥420�

billion.�This�figure�is�mostly�in�line�with�the�first�

year’s�profit�of�¥418.5�billion,�but�what�lies�

behind�it�has�changed�significantly.�As�a�result��

of�resolving�issues�in�the�previous�fiscal�year��

and�new�contributions�to�base�profit�by�each�

business�segment,�base�profit�will�increase�by�

approximately�¥70�billion.�Notably,�our�target��

of�¥180�billion�profit�after�tax�for�our�steadily�

growing�non-resources�areas�accounts�for�43%�

of�our�overall�profit�target,�and�we�are�on�track�

to�achieve�our�profit�forecast�of�¥200�billion�for�

non-resources�areas�in�the�fiscal�year�ending�

March�31,�2020.

� In�Annual Report 2017,�I�expressed�my��

confidence�that�we�can�reach�the�targets�of��

the�medium-term�management�plan.�That�

confidence�is�now�even�deeper.�

CEO Message


Business environment update

and Mitsui policies

We�continue�to�see�climate�change,�partial�

globalization,�expanding�populations�and�

improving�living�standards�in�emerging�nations,�

and�technological�innovation�as�important�

factors�in�our�medium-term�management��

plan,�and�in�light�of�changes�over�the�last�year,��

I�would�like�to�look�again�at�two�of�these�factors�

and�our�approach�to�tackling�them.�

� The�first�is�the�acceleration�of�measures�to�

tackle�climate�change,�in�particular�in�Europe�

and�the�U.S.,�and�together�with�this,�the�expan-

sion�of�partial�globalization�and�the�increasing�

importance�of�a�business�development�model�

aligned�with�the�issues�faced�by�each�region.�

� Mitsui�has�identified�“Protection�of�the�Global�

Environment”�as�a�material�issue�for�us.�We�

recognize�that�our�impact�on�the�environment�

presents�potential�risks�to�society�and�our�sus-

tainable�growth,�but�we�are�also�keenly�aware�

that�there�are�new�business�opportunities�for��

us�in�low-carbon�energy�and�environmentally�

friendly�infrastructure�and�products.

� “Stable�Supply�of�Resources�and�Materials”�and�

“Enhancement�of�Local�Industrial�Bases�&�Quality�

of�Life”�are�also�material�issues�for�Mitsui�and��

fall�under�the�ESG�umbrella.�The�increase�in�

demand�for�infrastructure,�resources,�and�food�

that�has�accompanied�population�growth�and�

economic�development,�the�changing�tastes�

associated�with�higher�standards�of�living,�and�

increasing�healthcare�needs�associated�with�

shifts�in�disease�structure,�are�already�recog-

nized�global�issues.�To�address�these�issues�

there�is�a�need�for�a�steady,�sustained,�long-term�

approach�to�opening�up�new�business�frontiers�

that�is�sensitive�to�regional�characteristics.�

Contributing�to�the�development�of�nations�

through�this�kind�of�approach�is�an�important�

mission�for�Mitsui.

� We�believe�that�contributing�to�economic�and�

social�development�at�the�country�and�regional�

level�and�addressing�global-scale�issues�such��

as�climate�change�through�our�wide-ranging�

global�business�activities—taking�a�long-term,�

balanced�approach�to�both—is�itself�a�sustain-

able�growth�strategy.

� The�second�factor�is�the�growing�importance�

of�data�capital.�There�is�something�striking�

about�how,�over�the�past�year�alone,�AI�and�IoT�

have�permeated�society.�This�phenomenon�has�

raised�the�value�of�data�in�business,�giving�it��

a�place�next�to�human,�manufactured,�and�

financial�capital,�and�is�even�changing�the��

face�of�capitalism�itself.�In�many�ways,�power��

is�steadily�shifting�into�the�hands�of�the��

consumer�as�business�models�made�possible��

by�ICT�become�more�deeply�entrenched.

� This�trend�is�not�only�the�concern�of�down-

stream�businesses�that�engage�directly�with�

consumers.�We�believe�that�it�is�becoming�

necessary�for�businesses�in�all�sectors,�including�

resources,�materials,�and�infrastructure,�to��

be�directly�aware�of�data�capital�and�the��

end�consumer.

� In�our�current�medium-term�management�

plan,�we�have�positioned�the�enhancement�of�

innovation�functions�as�a�key�initiative�and�we�

are�rolling�out�digital�transformation�activities�

throughout�our�group.�To�be�clear,�we�are�not�

merely�pursuing�AI�and�IoT�as�business�areas��

in�and�of�themselves.�Rather,�by�being�a�smart�

user�of�these�technologies,�which�means��

employing�them�at�our�diverse�project�sites�

around�the�world,�we�will�seek�to�gain�a�thor-

ough�understanding�of�AI�and�IoT,�and�use�this�

knowledge�to�strengthen�our�group.�

� At�the�corporate�level,�by�equipping�smaller�

teams�to�operate�with�a�high�degree�of��

sophistication,�we�can�enable�a�significant��

shift�of�personnel�to�the�business�frontlines��

and�strengthen�Mitsui’s�earning�power.�At�the��

business�frontline�level,�as�a�result�of�our�sensi-

tivity�to�consumer-centric�changes�in�the�

CEO Message


environment�and�our�ability�to�find�solutions�to�

global�challenges�through�our�unique,�on-the-

ground�expertise,�we�are�beginning�to�see��

cost�reductions�and�sales�growth�in�existing�

businesses.�Looking�ahead,�we�will�further�

evolve�the�business�by�promoting�cross-sector�

collaboration�across�divisions�and�business�

domains�to�accelerate�comprehensive�initiatives.

Core and growth area initiatives

for the current fiscal year

We�have�a�number�of�key�initiatives�for�the��

fiscal�year�ending�March�31,�2019.�In�Resources�

&�Energy,�Machinery�&�Infrastructure,�and��

Chemicals,�which�are�Mitsui’s�core�areas�and�

profit�base,�we�will�apply�the�concept�of��

“Enhancing�Our�Strengths.”

� In�Resources,�we�are�steadily�ramping�up��

the�Moatize�coal�mine�and�Nacala�infrastructure�

projects�in�Mozambique,�which�have�already�

begun�contributing�to�profit,�and�are�pursuing�

ongoing�enhancement�of�the�profit�base�in�

existing�businesses,�including�the�development�

of�South�Flank�iron�ore�mine�with�BHP.�In�Energy,�

in�the�E&P�business,�we�achieved�production�

start-up�at�the�Kaikias�oil�field�one�year�ahead��

of�schedule.�Looking�ahead,�we�will�launch�the�

Tempa�Rossa�oil�field�in�Italy�and�the�Greater�

Enfield�oil�field�in�Australia.�We�will�leverage�

new�Australian�subsidiary�AWE�to�enhance�

upstream�and�midstream�business�foundations�

in�oil�and�gas�while�improving�operator�functions�

and�expanding�the�scale�of�our�E&P�business�

activities�in�Australia.�In�our�LNG�business,�we�

are�making�progress�in�construction�projects�for�

the�launch�of�Cameron�LNG�in�the�U.S.,�scheduled�

for�2019,�and�we�are�accelerating�our�efforts�to�

make�a�final�investment�decision�on�our�LNG�

project�in�Mozambique.�Through�these�initia-

tives,�which�can�both�reduce�costs�and�increase�

production�volume,�we�are�increasing�revenue�

in�the�resources�area�without�needing�to�rely��

on�higher�commodity�prices.

� In�Machinery�&�Infrastructure,�we�are�launch-

ing�new�power�generation�projects�in�the��

Middle�East�and�Morocco�and�are�accelerating�

initiatives�in�next-generation�power�including�

distributed�power�and�services�by�U.S.�subsidiary�

Forefront.�In�FPSO�projects,�where�demand�is�

recovering,�primarily�at�Brazil-based�Petrobras,�

we�will�continue�to�enhance�our�fleet.�We�are�

also�deepening�efforts�in�mobility�services�such�

as�leasing,�rental,�and�sharing�in�the�railway,�

automotive,�and�aircraft�sectors.

� In�Chemicals,�we�are�pursuing�ongoing��

facilities�expansion�at�U.S.�terminal�business�ITC�

and�are�expanding�our�presence�in�the�coating�

materials�business�centered�on�Helios,�in�which�

we�made�the�decision�to�invest�in�April�2018.��

We�are�also�strengthening�our�business�base�

through�initiatives�such�as�the�expansion�of�

methionine�production�capacity�at�Novus�and��

by�enhancing�trading.

� In�our�four�growth�areas�too,�we�are�continu-

ing�to�push�ahead�with�aggressive�initiatives�to�

establish�the�revenue�pillars�for�sustained�

growth�through�our�next�medium-term��

management�plan�and�beyond.

� In�Mobility,�in�the�fiscal�year�ended�March�31,�

2018�we�engaged�in�a�range�of�initiatives��

toward�the�electrification�of�commercial�vehicles�

and�expanded�our�passenger�rail�network.��

CEO Message


●�Energy　●�Machinery�&�Infrastructure　●�Chemicals　●�Others

In�Chile,�we�pursued�initiatives�in�automotive�

operating�lease�and�rental�car�businesses�and�

we�will�aim�to�enhance�base�profit�in�these�

businesses.�Furthermore,�we�are�accelerating�

our�growth�strategy�for�Gestamp,�which�is�

planning�to�establish�its�first�plant�in�Japan��

in�Matsusaka,�Mie�Prefecture.

� In�Healthcare,�in�the�fiscal�year�ended�March�

31,�2018,�we�made�an�additional�investment��

in�Columbia�Asia�Group�and�will�continue�to�

strengthen�our�healthcare�ecosystem�in�Asia.��

We�are�addressing�the�demand�for�new�drugs�in�

Russia�through�our�investment�in�JSC�R-Pharm,�

a�Russian�pharmaceutical�company,�and�we�are�

expanding�our�businesses�that�provide�temporary�

staffing�and�permanent�placement�in�the�U.S.

� In�Nutrition�&�Agriculture,�in�May�2018�we�

invested�in�ETC�Group,�which�deals�in�agricul-

tural�products�and�materials�and�manufactures�

and�sells�food�products�in�East�Africa.�Mitsui�

already�has�a�presence�in�the�region�through�our�

Resources�&�Energy�business,�and�by�realizing�

synergies�through�our�involvement�in�food�and�

agriculture�and�infrastructure�improvement,�we�

aim�to�pursue�a�model�of�business�development�

that�shares�the�profits�of�economic�progress�

with�the�local�population�and�contributes��

to�the�further�economic�development�of��

African�nations.

� In�Retail�&�Services,�we�took�steps�to��

enhance�base�profit�in�our�domestic�and��

international�asset�management�businesses,�

expanding�the�businesses�in�part�through�our�

investment�in�CIM�in�the�U.S.�in�the�fiscal�year�

ended�March�31,�2018.�We�also�strengthened�

our�sales�and�marketing�capabilities�through�the�

acquisition�of�Bigi�Holdings�to�enhance�our�

direct�reach�to�consumers.�In�addition,�we�are�

improving�the�quality�of�the�assets�of�senior�

living�properties—a�retirement�community�on�

the�west�coast�of�the�U.S.�that�was�acquired�by�

MBK�Real�Estate�(MRE)—and�are�working�to�

CEO Message

Thoroughly

strengthen

existing

businesses

•� Tempa�Rossa�(oil)

•� Kaikias�(oil)

•� AWE�(gas) •� Greater�Enfield�(oil)

•� Cameron�(LNG)

•� FPSO

•� �Safi,�Salalah-2��

(power�generation)

•� Bigi�Holdings

•� �Nippon�Steel�&�Sumikin�

Bussan�Corporation

•� Helios

•� ITC�expansion

•� �12SPP,�Track3B,��

Ibri,�Sohar3��

(power�generation)

Investment�in��

new�projects

Investment�in��

new�projects

Core operating cash flow: ¥630bn

Profit for the year: ¥440bn

Core�operating�cash�flow:�¥570bn

Profit�for�the�year:�¥420bn

Year�to�March�2019 Year�to�March�2020

The accumulation of assets and the start of their contributions to earnings and cash flow


enhance�the�business’�profit�base.

Enhancing human resources

and governance

The�origins�of�Mitsui’s�business�are�in�trading�

and,�over�time,�through�our�involvement�in��

a�broad�range�of�business�sectors�and�handling�

a�diverse�array�of�goods,�we�expanded�from�

trading�into�business�investment,�leveraging�the�

vast�expertise,�customer�base,�and�partnerships�

that�we�had�fostered�through�trade.�By�partici-

pating�in�the�management�of�these�projects,�we�

helped�increase�their�value�and�that�in�turn�gave�

rise�to�further�trading�opportunities�and�network�

expansion.�Through�the�continuous�repetition��

of�this�cycle,�Mitsui�has�evolved�into�its�current�

form�and�our�businesses�have�developed�to�the�

point�where�each�has�its�own�competitiveness.�

Though�not�on�the�balance�sheet,�the�customers�

and�partner�networks,�and�our�more�than�42,000�

professionals�who�have�the�capability�and�

independence�to�leverage�these�relationships��

to�the�full,�what�we�call�our�“Strong�Individuals,”�

remain�Mitsui’s�greatest�assets.�The�continued�

strengthening�of�each�individual�will�always�be��

a�key�management�focus.

� Promoting�a�level�playing�field�dynamically��

for�our�people�in�every�region�in�which�we�

operate�encourages�mutual�understanding,�

acceptance,�and�friendly�competition�that�tran-

scends�nationality,�gender,�and�language,�and�

by�working�to�“strengthen�each�individual”�we�

are�building�a�full-strength�team�of�professionals�

with�diverse�backgrounds�and�perspectives.

� Turning�to�governance,�in�the�fiscal�year�ended�

March�31,�2018�we�further�diversified�our�Board�

of�Directors,�improving�the�balance�of�represen-

tation,�enhancing�the�Board’s�effectiveness,�and�

demonstrating�greater�accountability�by�encour-

aging�deeper�discussion�on�major�company�

policy�and�strategy��and�their�implementation.�

We�recognize�that��in�order�to�ensure�meaning-

ful�debate�there�must�be�a�consistent�level�of�

understanding�of�the�agendas�among�directors.�

The�thorough�preparation�in�advance�enables�

deeper�discussion�in�Board�meetings,�and�I�

believe�strongly�that�it�has�been�a�key�factor�in�

the�improvement�of�the�quality�of�management.

In conclusion

I�noted�above�that�my�confidence�in�achieving�

the�targets�of�the�medium-term�management�

plan�has�further�deepened.�As�I�noted�in�Annual

Report 2017,�I�am�confident�also�that�reaching�

our�three-year�quantitative�targets�will�be�only�

one�of�many�milestones�we�pass�on�the�road��

to�fulfilling�our�long-term�vision�for�Mitsui�as��

a�group�that�draws�on�its�comprehensive�

strengths�and�continuously�takes�the�initiative��

to�incubate�and�develop�new�business.

� I�will�do�my�utmost�to�combine�effective�

leadership�with�sound�corporate�governance��

to�achieve�not�only�the�targets�for�the�current�

fiscal�year,�ending�March�31,�2019,�which�is�a��

crucial�stepping�stone�along�that�path,�but��

also�for�the�fiscal�year�ending�March�31,�2020�

and�for�the�sustainable�growth�of�Mitsui�further�

into�the�future.�I�very�much�appreciate�your�

interest�in�our�progress,�and�look�forward�to�

your�continued�support.

September�2018

Representative�Director,��


CEO Message


Aiming for Sustainable GrowthCHAPTER 1

MITSUI�&�CO.,�LTD.��Integrated�Report�2018�010

Aiming for Sustainable GrowthCHAPTER 1

012 Our Corporate Value Creation Process

014 Material Issues of Focus (Materiality)

017 Capitals

018 Business Model for Growth That

Balances between Trading and

Business Management

020 Positioning Strategy That Leverages

Our Competitiveness

022 Portfolio Management

024 Enhancing Management Capital 1

Human Capital

The individual builds the business,

and the business cultivates the individual

026 Enhancing Management Capital 2

Relationship Capital

Engagement for business creation

028 Efforts to Address Climate Change

through Our Business

030 Message from the Chairperson of the

Sustainability Committee

MITSUI�&�CO.,�LTD.��Integrated�Report�2018� 011

Our�Corporate�Value�Creation�Process

The origin of Mitsui’s value creation lies in its approach of identifying societal issues and providing

industrial solutions that address social needs. Under “Driving Value Creation,” our medium- to long-term goal,

we are fully leveraging our various capitals and our highly competitive business model to formulate and execute

our medium-term management plan, which addresses our Materiality. While allocating our finite capital in

a well-balanced manner, we aspire for not only sustainable corporate value growth but also sustainable

environmental and social development.

◦��Population�increase

◦��Widening�gap�in�income�

between�rich�and�poor

◦��Climate�change,��

environmental�pollution

◦��Aging�population�

◦��Rapidly�growing�middle-

income�class

◦�Increase�of�healthcare�needs

◦��Diversification�of�human�

resources

◦��Energy�and�water�shortages

◦��Changes�in�work�style

◦��Increase�and�diversification��

of�infrastructure�needs

◦��Technological�innovation

◦��Accelerating�smartification�

accompanied�by�increased�

security�risk

◦��Further�consideration��

for�human�rights

Business Model

�P.018–023

◦��Business�Model�for�Growth�

That�Balances�between�

Trading�and�Business�

Management

◦��Positioning�Strategy��

That�Leverages�Our�

Competitiveness

◦��Portfolio�Management

Capitals �P.017

◦��Human�capital

◦��Organizational�capital

◦��Relationship�capital

◦��Financial�capital

◦��Natural�capital

◦��Manufactured�capital

Megatrends That Mitsui

Envisions

Material Issues of Focus

(Materiality)

Mitsui’s Growth Model

Medium-term

Management Plan

�P.014–016

Mitsui’s Vision

―Mitsui is a group that incubates and develops new businesses―

A diverse pool of talented professionals that take the initiative to create

new business and actively leverage Mitsui Group’s comprehensive strengths

and global network for sustained creation of new value

Stable supply of

resources & materials

Enhancement of local

industrial bases & quality

of life

Protection of the

global environment

Respect for

human rights

Corporate governance &

human resources


How We Quantify Outcomes �P.034–035

Profit (loss) for the year attributable to owners

of the parent / ROE 123

Core operating cash flow 13

Total assets / Net DER 2

Total shareholder return amount /

Total shareholder returns

as a percentage of core operating cash flow 3

Equity share of production 14

Power generating capacity (gross) 14

Female managerial staff /

Female employees dispatched overseas 45

Number of NS GMs �P.025 45

Greenhouse gas (GHG) emissions 4

Outcomes

Core

Areas

Growth

Areas

■�Iron�&�Steel�Products

■�Mineral�&�Metal�Resources

■�Machinery�&�Infrastructure

■�Chemicals

■�Energy

■�Lifestyle

■��Innovation�&�Corporate��

Development

Capital Allocation to Priority Areas;

Implementation of Medium-term Management Plan

Maintain robust,

sustainable earnings

growth 1

Boost asset and

capital efficiency 2

Continually increase

shareholder value 3

Create social and

environmental value 4

Improve human

resource capabilities 5

Under the current medium-term management plan, we pursue each

business strategy according to two strategic areas.

Operating

segments

Core Areas◦��Resources�&�Energy

◦��Machinery�&�

Infrastructure

◦��Chemicals

Growth Areas◦��Mobility

◦��Healthcare

◦��Nutrition�&�Agriculture

◦��Retail�&�Services

Digital Transformation

Cash Flow Focused

Management;

Strengthen

Financial Base

Enhance Governance,

Personnel, and

Innovation Functions

◦��Diversifying�the�Board��

of�Directors

◦��Management�geared�

toward�a�sustainable�

society�and�Mitsui

��P.072–093�

Corporate�Governance

��P.042–045�

Progress�of�Medium-term�

Management�Plan


Material�Issues�of�Focus�(Materiality)

As a provider of industrial solutions for sustainable social development, we identified issues that are of high

importance for society and our stakeholders and that have a significant impact on our corporate management.

We designated these issues as Materiality. Materiality provides us with guiding principles to accurately assess

expectations of Mitsui and fulfill our social responsibility. Accordingly, addressing these issues will help us

maintain and strengthen our value creation capabilities in a sustainable manner.

Megatrends That

Mitsui Envisions

�P.012

Social and stakeholder

engagement

�P.026�Engagement��

for�business�creation

Periodic reviews

International consensus

•��United�Nations�Global�

Compact

•��Sustainable�

Development�Goals�

(SDGs)

•��OECD�Guidelines�for�

Multinational�Enterprises

•��Universal�Declaration�of�

Human�Rights

•��ILO�Declaration�on�

Fundamental�Principles�

and�Rights�at�Work

•��Guiding�Principles�on�

Business�and�Human�

Rights

•��ISO26000

•��GRI�Sustainability�

Reporting�Guidelines

Identification Processes on Materiality

Imp

orta

nc

e fo

r soc

iety

an

d sta

ke

ho

lde

rs

Impact on our corporate management

5 Material

Issues

Review Process on Materiality

Please�see�page�13�of�Sustainability Report 2018.

Verification of compatibility with manage-

ment and business strategies at Sustainability

Promotion Officer’s meetings and the

Sustainability Committee

Verification of adequacy by external experts

Approval by the Corporate Management

Committee and the Board of Directors’

meetings

Formulation / Implementation of specific

initiatives under Materiality


Materiality Recognition�of�societal�issues Main�risks�and�opportunities

Stable supply of


•��Population�increase�and��

expansion�of�demand�for�

resources�and�materials

•��Expanded�responsibility�for�

environmental�and�social�aspects�

in�supply�chain

Risks

•��Suspension�of�business�operations�and�instability�in�the�supply�of�energy�and�food�

resources�because�of�climate�change�and�population�growth

Opportunities

•��Sustainable�resource�development�and�food�supply

•��Reinforced�competitiveness�through�measures�to�ensure�traceability

Enhancement of

local industrial bases

& quality of life

•��Aging�infrastructure�in��

developed�countries

•��Infrastructure�development�in��

emerging�countries

•��Food�safety�and�reliability

•��Maintenance�of�health,�securing�

of�medical,�nursing�care,�and�

welfare�services

Risks

•��Loss�of�credibility�due�to�safety�or�health�problems�affecting�infrastructure�users��

or�final�consumers�of�products�and�services

Opportunities

•��Enhancing�quality�of�life�in�developing�countries�through�infrastructure�

development

•��Measures�to�ensure�food�safety�and�reliability

•��Growing�demand�for�food�with�high�added�value�in�response�to�the�growing��

middle-income�class

•��Changes�in�shifts�in�disease�structure�due�to�population�growth/economic��

development�and�increase�in�healthcare�needs�due�to�aging�

•��Creation�of�markets�by�promoting�ICT-based�business�to�build�urban�social��

infrastructure�in�response�to�the�move�toward�developing�smart�cities�

Protection

of the global

environment

•��Global�warming�and�climate�

change

•��Loss�of�biodiversity

•��Energy�and�water�shortages

•��Environmental�pollution

Risks

•��Changes�in�each�country’s�policies�and�regulations�related�to�the�transition��

toward�a�low-carbon�economy

•��Impact�resulting�from�the�creation�of�new�technologies�and�new�markets�on�supply�

and�demand�of�existing�businesses

•��Operational�risks�associated�with�the�physical�impact�of�climate�change

•��Adverse�effects�on�production�yields�in�agricultural,�forestry,�and�fishery�products�

due�to�abnormal�weather

•��Increase�in�environmental�costs�resulting�from�ecosystem�destruction�and��

degradation�caused�by�business�activities�

Opportunities

•��Expansion�of�environment-related�markets�due�to�increased�environmental��

awareness�and�the�tightening�of�regulations

•��Creation�of�new�business�models�through�circular�economy�and�sharing

•��Expansion�of�business�domains�(renewable�energy,�etc.)�as�a�result�of�energy�

diversification

Respect for

human rights

•��Greater�responsibility�for��

human�rights�in�the�supply��

chain�(labor�practices,�impact��

on�local�residents,�etc.)

•��Consideration�for�indigenous�

people�in�conjunction�with�

resource�development

•��Illicit�use�of�personal�information�

that�may�be�obtained�via�the�

increasingly�widespread�use��

of�Internet�and�digital��

communication�technology

Risks

•��Disputes�or�protests�concerning�human�rights�issues�in�every�spectrum�of��

business�that�could�hinder�the�start-up�or�continuation�of�business

•��Leakage�of�information�held�by�the�company�that�could�be�used�to�identify�

individuals

Opportunities

•��Strengthening�of�the�ability�to�ensure�stable�supply�through�consideration�for�

human�rights�across�all�supply�chains�

Corporate

governance &

human resources

•��Malfunctioning�of�corporate�

governance�and�internal�controls

•��Stagnation�in�productivity�due�to�

cookie-cutter�working�styles

•��Diversification�and�globalization�

of�human�resources

Risks

•��Impact�due�to�a�lack�of�appropriate�decision�making�from�a�broad�perspective

•��Corruption�in�business�of�high�public�significance�in�emerging�countries�and��

other�markets

•��Suspension�of�business�operations�due�to�information�security�problems

Opportunities

•��Contributions�to�labor�productivity�improvement�via�innovation�in�working�styles

•��Promotion�of�fair�and�equitable�treatment�and�meaningful�human�resources�training

•��Enhancement�of�individual�competitiveness�through�promotion�of�diversity�

management

•��Creation�of�new�business�opportunities�focusing�on�the�solution�of�societal�issues�

through�heightened�employee�sustainability�awareness

�P.028－029��

Efforts�to�Address�

Climate�Change�

through�Our�Business

1 2 3 4 5

Stable supply of


Enhancement of

local industrial bases

& quality of life

Protection of the

global environment

Respect for

human rights

Corporate governance

& human resources

Realize through our business Business foundation


Material�Issues�of�Focus�(Materiality)

Materiality Related�SDGs�theme Initiatives�of�Mitsui

Stable supply of

resources &

materials

Contributing�to�the�stable�supply�of�resources�and�materials�through�building�of�optimal�supply�

chains,�spanning�all�stages�from�upstream�to�downstream

� �Contribute�to�the�stable�supply�of�metal�resources�and�energy,�and�maintain�an�asset�portfolio�

that�is�sustainable�over�the�long�term

� �Steadily�and�efficiently�supply�safe�and�reliable�food�resources

� �Traceability�management�for�grain�crops,�such�as�wheat,�corn,�and�soybeans�starting�at�the�

production�and�collection�phases

Meeting�society’s�expectation�together�with�our�business�partners�in�order�to�resolve�various�

issues�in�the�supply�chain

� �Ensure�compliance�with�laws�and�regulations,�respect�for�human�rights,�and�maintenance�of�

safety�and�sanitary�working�conditions;�reduce�environmental�load;�and�give�consideration�to�

securing�the�safety�and�reliability�of�our�products�and�services

Enhancement of

local industrial

bases & quality

of life

Contributing�to�nation�building�and�enhancing�quality�of�life�through�the�establishment�of�

infrastructure

� �Respond�to�the�increasing�demand�for�core�infrastructure�in�emerging�countries,�which�are�

experiencing�remarkable�population�growth�and�economic�development,�and�by�doing�so,�

work�to�cultivate�local�industries�and�create�employment

� �Secure�a�safe�and�reliable�food�supply

� �Respond�to�the�need�for�food�with�high�added�value,�focusing�particularly�on�greater�demand�

for�deliciousness�and�a�heightened�awareness�of�health

� �Pursue�the�establishment�of�healthcare�ecosystems,�which�are�next-generation�medical�

infrastructure�that�enhances�the�quality�and�efficiency�of�medical�treatment

Protection

of the global

environment

Making�contributions�by�providing�industrial�solutions�to�environmental�problems�through�the�

development�of�environment-related�businesses

� �Promote�businesses�and�strengthen�response�capabilities�in�the�field�of�renewable�energy

� �Proceed�with�initiatives�toward�smart�cities,�modal�shifts,�and�the�widespread�use�of�new�

energy�vehicles�such�as�electric�vehicles

Continuously�revising�our�asset�portfolio�with�an�awareness�of�enhancing�our�resistance�to�

climate�change-related�risks

� �Monitor�government�policies�and�regulations�in�each�country�of�operation

� �For�energy,�promote�the�strengthening�of�our�asset�portfolio�related�to�gas�and�manage�a�

crude�oil�portfolio�with�an�awareness�of�the�time�period�between�2030�and�2040

� �For�metal�resources,�strengthen�our�asset�portfolio—centered�on�iron�ore,�coking�coal,�and�

copper—by�bolstering�our�cost�competitiveness�and�promoting�flexible�asset�replacement�

that�responds�to�changes�in�demand�forecasts

� �Gradually�reduce�the�ratio�of�coal-fired�thermal�power�within�our�equity�share�of�power�

generation�capacity�and�increase�the�proportion�of�renewable�energy,�including�hydraulic�

power,�to�30%�by�2030

Establishing�targets�to�reduce�annual�energy�consumption�by�an�average�of�1%�or�more�at�the�

Company�and�its�domestic�subsidiaries

Respect for

human rights

In�terms�of�resource�development,�constructing�infrastructure�that�supports�the�lifestyles�of�new�

inhabitants�in�planned�development�areas

Establishing�a�structure�for�protecting�and�managing�personal�information

� �Create�a�CPO�office�under�the�Chief�Privacy�Officer�(CPO)�and�raise�the�awareness�of�all�officers�

and�employees�regarding�the�protection�of�personal�information

� �Regularly�review�the�status�of�personal�information�management�in�the�daily�course�of�

business�and�enhance�it�as�needed

Corporate

governance &

human

resources

Taking�steps�to�improve�the�effectiveness�of�our�corporate�governance�structure

� �Improve�transparency�and�accountability

� �Clarify�the�separation�of�management�oversight�and�execution

Strengthening�sustainability�governance

� �Cautiously�promote�businesses�in�accordance�with�the�Specially�Designated�Business�

Management�System,�which�responds�to�business�domains�with�high�qualitative�risks�

pertaining�to�ESG�(environmental,�social,�and�governance)�and�other�factors

Reinforcing�compliance�under�the�concept�that�our�sound�reputation�is�the�foundation�of��

our�business,�and�we�recognize�that�it�is�only�through�compliance�that�we�can�maintain�that�

reputation�and�gain�even�more�trust�from�our�customers

� �Thoroughly�enhance�the�compliance�awareness�of�each�employee

� �Establish�compliance�frameworks�on�a�Global�Groupwide�basis

Enhancing�our�pool�of�talented�professionals,�who�represent�our�greatest�asset

Promoting�diversity�management

� �Build�a�full-strength�team�comprising�our�diverse�human�resources�in�terms�of�nationality,�

gender,�perspective,�etc.

Details of Materiality

Please�see�page�12�of�Sustainability Report 2018.


Capitals

Through the global development of a broad range of businesses across a wide variety of industries and value chains,

Mitsui has realized unique industrial solutions and value creation. By doing so, Mitsui has amassed the necessary

capital to deliver business value across the world through proactive business creation. Going forward, Mitsui will

leverage its highly competitive capital aiming for creation of further value.

Diverse, Talented Professionals

（As�of�March�31,�2018）

Comprehensive Strengths

（As�of�April�1,�2018）

Financial Base

（As�of�March�31,�2018）

EXPERTISE

Product and industrial expertise

Regional expertise

Business development expertise

Frontline management expertise

Flexibility to be active on a global stage

42,304�(Consolidated)

5,859�(Non-consolidated)

AXES

Functional × Product × Regional expertise

Subsidiaries�and�Associated�Companies*1:�472

Headquarter�Business�Units:�16

Overseas�Regional�Business�Units:�3

(Americas,�Europe,�the�Middle�East�and�Africa,�and�Asia�Pacific)

Business�Supporting�Units:�11

Corporate�Units:�18

Assets:�¥11.3�trillion

Shareholders’�Equity*2:�¥4.0�trillion

Net�DER:�0.78�times

Core�Operating�Cash�Flow:�¥666.5�billion�

(Fiscal�year�ended�March�31,�2018)

Global Network

（As�of�April�1,�2018）

PARTNERSHIPS

Clients

Suppliers

Business partners

Government bodies and

local governments

Local communities

Total�Number�of�Offices:�137(Japan:�12,�Overseas:�125)

Geographical�Scope�of�Activities:��

66�Countries�and�Regions

Credit�Rating

Moody’s:�A3（STABLE）

S&P:�A（STABLE）

R&I:�AA–（STABLE）

Please�see�pages�024�and�025�for�details�

on�Mitsui’s�human�capital.

Please�see�pages�026�and�027�for�details�

on�Mitsui’s�relationship�capital.

Please�also�see�the�CFO�Message�on�pages�

036�to�041.

Please�see�page�021�for�details�on�Mitsui’s�functional�

expertise�and�page�071�for�details�on�our�product�

and�regional�expertise.

Human

Capital

Organi-

zational

Capital

Relation-

ship

Capital

Financial

Capital

*1.�As�of�March�31,�2018

*2.�Total�equity�attributable�to�owners�of�the�parent

1 2 3 4 5


Business�Model�for�Growth�That�Balances��

between�Trading�and�Business�Management

Through our original business of trading, Mitsui has cultivated expansive networks comprising a wide range

of clients and has leveraged these networks to carry out business investments. Mitsui gets involved in the

management of the projects in which we have invested in an effort to enhance their value. In turn, these projects

help Mitsui further promote our trading business and expand our networks. Through the repetition of this cycle,

Mitsui has developed our current business structure.

Our diverse pool of talented professionals work to combine the sophisticated product expertise that each

business unit possesses with our regional expertise, which is supported by local employees who are active

in regions around the world, and various functional expertise as a general trading company. In this way, these

professionals are leveraging our long-cultivated client base and networks to create new business models and

pursue new projects.

Sustainable profit growth

Business management

Business development

Trading

Diverse pool of talented professionals

Client base and business partner relationships

1950s�� 2000s

◦ Automotive and motorcycles

◦�

◦ Natural gas

◦ Iron ore

◦�Daily necessities

◦ Iron and steel products

◦ Machinery

◦ Chemicals

As�a�general�trading�company,�Mitsui’s�bread-and-butter�business�has�always�been�trading.�To�leverage�the�superior�trading�

functions�that�we�possess�to�the�full,�Mitsui�has�naturally�formed�a�business�structure�for�handling�an�extensive�lineup�of�

products�through�a�wide�variety�of�outlets.�Our�traditional�core�competencies�have�been�trading�activities�that�link�product�

demand�with�product�supply�and�the�extensive�network�of�clients�we�have�acquired�through�these�trading�activities.�

Additionally,�these�competencies�have�included�the�judgment�capabilities,�keen�awareness,�and�appropriate�conduct�of�our�

employees,�who�have�helped�us�maintain�and�expand�our�network.

The Diverse Range of Products That General Trading Companies Handle

Unwavering Value Creation and Profit Growth

Functional

expertise*

Product

expertise

Regional

expertise

*�Marketing,�Logistics,�Finance,�Risk�management,�Digital�transformation

��Please�see�“Mitsui’s�Continuing�Evolution�by�Meeting�the�Changing�Needs�of�the�Times”�on�pages�096�and�097.


1. Expansion in business management beginning with trade

2. Increase in non-current assets due to business

management expansion

3. Maintenance of current asset scale in response

to new trade brought about by business management

CASE The Cameron LNG Project in the U.S. CASE

Truck Leasing and Rental Business

and Logistics Business in the U.S.

Mitsui�has�long�been�involved�in�overseas�trading,�mainly�

in�Southeast�Asia�and�the�Americas,�engaged�in�automotive�

manufacturing�and�assembly,�distribution,�and�retail�

businesses.�In�the�U.S.,�we�have�formed�a�trust-based�

relationship�with�the�Penske�Automotive�Group,�which�

operates�automotive�and�commercial�dealerships,�through�

our�investment�in�them�in�2001.�This�trust-based�relation-

ship�provided�us�with�an�opportunity�to�invest�in�Penske�

Truck�Leasing�Co.,�L.P.�(PTL)�in�2015,�which�operates�under�

the�umbrella�of�the�Penske�Automotive�Group.�PTL�is�one�of�

the�largest�truck�leasing�companies�in�North�America�and�

primarily�engages�in�full-service�truck�leasing,�contract�

maintenance,�and�commercial/consumer�truck�rental�

businesses.�In�addition,�PTL�operates�a�logistics�business�

that�mainly�serves�North�America.�Mitsui�seeks�to�fully�take�

advantage�of�its�diverse�business�footprint�and�become�the�

solution�provider�of�fleet�management�and�supply�chain�

efficiency�via�PTL’s�vast�capacities�to�our�business�partners�

and�affiliates.

In�2013,�Mitsui�invested�in�the�Cameron�LNG�Project,��

which�is�located�just�north�of�the�Gulf�of�Mexico�in�the�U.S.�

state�of�Louisiana.�For�this�project,�liquefaction�facilities��

are�currently�under�construction�aiming�for�production�

commencement�of�three�LNG�production�trains�within�

2019.�We�have�secured�an�annual�LNG�tolling�capacity�of�

four�million�tons,�spanning�over�20�years.�After�production�

begins,�the�Cameron�LNG�Project�will�utilize�seven�of�our�

LNG�vessels�to�sell�LNG�on�a�global�basis.�Natural�gas�and�

LNG�produce�relatively�lower�amounts�of�greenhouse�gas�

emissions�and�are�expected�to�increase�in�global�demand�

over�the�medium�to�long�term.�We�already�own�upstream�

shale�interests�in�projects�that�contribute�to�natural�gas�

production�in�the�U.S.�Through�the�Cameron�LNG�Project,�

we�will�contribute�to�the�stable�production�of�LNG�as�well�

as�a�stable�energy�supply�for�Japan�and�the�rest�of�the�world.

Changes in Mitsui’s Business Portfolio (Total Assets)

2018

2005

1991

Current�assetsNon-current�assets

7.02.8

3.2

7.1

4.4

4.2

¥�trillion

¥9.8 trillion

Fiscal�year��

ended�March��

1991

Non-current�assets

29%

¥2.8 trillion


42%

¥3.2 trillion


63%

¥7.1 trillion

Current�assets

71%

¥7.0 trillion

Current�assets

58%

¥4.4 trillion

Current�assets

37%

¥4.2 trillion

¥7.6 trillion

Fiscal�year��

ended�March��

2005

¥11.3 trillion

Fiscal�year��

ended�March��

2018

Business managementBusiness management TradingTrading

AutomotiveLeasing

and rentals

Development

and

production

LNG

1 2 3 4 5


Positioning�Strategy�That�Leverages�Our�Competitiveness

Competitive

business

lineup

Growth areas to

be developed

Resources & Energy

Machinery & Infrastructure

Chemicals

Core areas

Mobility

Retail &

ServicesHealthcare

Portfolio management

�P.022–023

Nutrition &

Agriculture

In “Core areas,” Mitsui continuously adds assets through bolt-on acquisitions in its areas of strength, thereby further

enhancing its strong businesses. In “Growth areas,” Mitsui’s next profit pillars, we develop and evolve our existing

businesses, including those in our core areas where we are already competitive. In addition, we allocate our limited

capitals in a well-balanced manner through portfolio management, with the aim of building a robust profit base as

well as establishing new growth areas.

Existing businesses other than core areas

Functional expertise

Product expertise

Regional expertise

Overview Our Competitiveness in Core Areas

Value provision Competitiveness Efforts to gain an even greater

competitiveness

Mineral & Metal

Resources

•� �Cost�competitiveness

•��Stable�supply�of�a�consistent�level�of�quality

•� �Financing

•��Marketing�(purchasing�power)

•� �Overwhelming cost competitiveness of owned assets

•� �Ability�to�supply�a�consistent�level�of�quality

•� �Relationships with influential partners (including governments

and local communities)

•� �Brand�and�trustworthy�reputation

•��Strengthen�a�three-pronged�

approach�of�enhancing�cost�

competitiveness,�production�

volume,�and�reservesEnergy

Machinery &

Infrastructure

(Infrastructure

Projects)

•� �Stable�over�the�long-term�supply�of�

electricity�and�gas

•��Provision�of�services�related�to�offshore�

energy

•��Financing

•��Ability to organize and manage projects

•� �Know-how�in�infrastructure�development�and�management

•��Ability�to�negotiate�long-term�contracts

•� �Long-term, trust-based relationships with important clients

•� ��Relationships with influential partners (including governments

and local communities)

•� �Undertake�a�digital�transformation�

for�our�assets

Machinery &

Infrastructure

(Integrated

Transportation

Systems)

•� �Establishment�and�expansion�of�local��

value�chains

•��Sales�support�and�provision�of�financing

•��Provision�of�comprehensive�services�related�

to�leasing,�maintenance,�logistics,�etc.

•� �Trading network

•� �Marketing�capabilities

•� �Logistics�expertise

•��Long-term, trust-based relationships with important clients

•� �Relationships with influential partners

•� �Take�initiatives�toward�the�growth�

area�of�“Mobility”

Chemicals •� �Virtual�pipeline

•��Cost�competitiveness

•��Stable�supply

•� �Trading network

•� �Marketing�capabilities

•� �Know-how�in�transportation�of�chemicals�that�are�difficult�to�

transport

•� �Industrial�and�material�expertise�(judgment�capabilities)

•� �Multilayered relationships with influential partners and clients

•� �Take�initiatives�toward�the�growth�

area�of�“Nutrition�&�Agriculture”

•�Reinforce�trading�capabilities


We provide the following functions to our clients,

business partners, and investees in every country

and region.

(1)��Create�new�markets�by�drawing�on�sales��

capabilities�developed�in�extensive�experience�

aligned�with�various�business�practices�as�well��

as�our�powerful�information�gathering�and��

analysis�expertise

(2)��Provide�optimal�logistics�solutions�in�both��

transportation�and�cost�efficiency

(3)��Offer�and�advise�on�various�financial�functions,�

from�fund�procurement�and�financial�structuring�to�

trade�finance

(4)��Propose�risk�reduction�and�control�by�utilizing�

know-how�accumulated�over�many�years

(5)��Optimize�business�processes�and�revolutionize�

business�models�by�utilizing�AI�and�IoT

Establishing Growth AreasRather than establishing businesses in which we have no experience or track record, we adopt a perspective that

considers the overall value chains of our existing businesses, fully utilizing the industrial expertise we have culti-

vated in these businesses, as well as our established network of clients and partnerships, to create new business

models and promote new projects.

(1) Marketing

(2) Logistics

(3) Finance

(4) Risk

management

(5) Digital

transformation

Mobility


×

Regional expertise


×

Regional expertise


×

Regional expertise


×

Regional expertise


Iron & Steel Products

Chemicals

Chemicals

Lifestyle

Innovation & Corporate

Development

Lifestyle

LifestyleHealthcare

Nutrition & Agriculture

Retail & Services


Product

expertise

Regional

expertise

Product expertise

Chemicals

Overview The Functions We Provide

1 2 3 4 5


Portfolio�Management

Lifecycle�Management�of�Investments�and�Practicing��

Disciplined�Portfolio�Management

Basic philosophy of portfolio management

Strengthening earnings bases of existing businesses and leveraging economies of scale

Generating inter-business synergies through strategic positioning in the value chain

Acquiring new function platforms

Expanding into new business fields and taking on the

challenge of creating innovative new business models

01

02

03

Business Frontline

Business Supporting Unit*1

Project IncubationMitsui�develops�existing�businesses�by�

leveraging�the�networks�and�insights�

gained�through�partnerships�and��

customer�relationships�in�various��

industries�and�regions�while�seeking�

out�and�advancing�new�projects�with�

the�potential�to�become�promising�

businesses�in�a�similar�manner.

Risk Management

• Objective self-analysis of the depth of

our understanding and management

capabilities regarding the risks of

target markets and business models

• Necessary measures including partner

involvement and risk hedging

Final Investment Decision

and ExecutionInvestments�are�decided�and�executed�

once�it�has�been�determined�that�they�

meet�internal�approval�standards�and�

that�contractual�obligations�have��

been�fulfilled.

Investment Discipline

• Appropriate accounting treatments for

factors such as investment disparities

Analysis, Evaluation,

and DeliberationInvestment�decisions�are�made�based�

on�analysis�of�qualitative�factors�as��

well�as�the�required�profitability�ratio�

and�other�quantitative�standards.*2�

Moreover,�a�variety�of�factors�are��

evaluated�in�making�decisions,�includ-

ing�the�ability�to�execute�business�plans,�Mitsui’s�functions�to�be�utilized,�probability�

of�increasing�value,�conditions�of�contracts�with�other�related�parties,�risk�analysis�and�

management�measures�(including�ESG-related�risks),�value�of�the�business,�period��

of�project�execution,�and�internal�control�effectiveness.�Investment�candidates�are�

screened�and�final�decisions�are�made�after�deliberations�by�relevant�committees.

Risk Management

• Appropriateness evaluations and stress checks based on prerequisite conditions

related to commodities markets, foreign exchange, interest rates, and costs

• Contract condition negotiations and due diligence

• Deliberations held at every stage by the Council of Individual Proposals,

the Corporate Management Committee, and the Board of Directors regarding

factors such as investment, loan, and guarantee amount

Quantitative Guidelines of Each Meeting Structure to Select Proposals for Deliberation

Meeting�Structure Proposals Amount

Council�of��

Individual�Proposals

Investment,�loan,�and�guarantee�proposals,�project�entailing�

acquisition�of�business�assets�or�other�such�project

Over�¥5.0�billion

Corporate��

Management�

Committee

Total�investment,�loan,�and�guarantee�amount�on�a�

consolidated�basis

Over�¥15.0�billion

Among�investment,�loan,�and�guarantee�proposals,��

matters�to�be�resolved�by�the�Board�of�Directors

ー

Board�of�Directors Disposal�and�acquisition�of�important�business�assets Over�¥40.0�billion

• In accordance with the Specially Designated Business Management System,

separate discussions are held, when necessary, regarding business domains

with high qualitative risks pertaining to ESG and other factors.

Details on the Specially Designated Business Management System

https://www.mitsui.com/jp/en/company/outline/governance/system/index.html

Striving to improve business quality and ensure returns, Mitsui applies its refined risk management capabilities to

all stages of business, beginning with selecting investment candidates that we have discovered by leveraging

our expansive networks and industrial expertise, and continuing on through the process of making investment

decisions, starting up projects, enhancing corporate value, and strategically recycling assets. In addition, through

portfolio management, we efficiently allocate our limited capital in a well-balanced manner to areas that are of

importance to the Group, to further strengthen our business portfolio with the aim of our sustainable growth and

social development.

*1.��Planning�&�Administrative�Divisions�related��

to�each�business�segment�and�Financial�

Management�&�Advisory�Divisions�(Please�see��

organization�chart�on�page�070�for�details.)

*2.��Quantitative�standards�considered�include�

consolidated�internal�rate�of�return,�ratio�of�

consolidated�investments�and�loans�out-

standing�to�guarantees,�and�risk-return�ratio.�

The�risk-return�ratio�is�the�ratio�between�the�

amount�of�risk�assets�associated�with�a�specific�

project�and�the�profit�for�the�year�projected�to�

be�generated�through�Mitsui’s�equity�holdings�

in�the�project.�Risk�assets�refer�to�the�maximum�

amount�of�anticipated�loss�on�operating�

receivables�and�investments,�assets�such�as�

property,�and�off-balance-sheet�positions�such�

as�liability�on�guarantee�belonging�to�the�

Group,�calculated�by�multiplying�internally�

established�risk�weight�according�to�latent�

risks�such�as�credit�and�market�risks.


Portfolio�Management

Lifecycle�Management�of�Investments�and�Practicing��

Disciplined�Portfolio�Management

Confirm�business�strategies,�investment�

plans,�project�priorities,�and�cash�flow��

projections�of�each�business�unit

•� �Confirm�purpose�of�all�investments

•� �Determine�turnaround�plans�or�exit�policies�for�unprofitable�businesses�and�businesses�

falling�below�withdrawal�standard�cutoffs*3

•� �Estimate�market�value�of�businesses�and�determine�emergency�liquidation�priorities

•� �Follow�up�on�the�progress�of�the�business�plan

Fiscal

year-endStart of

fiscal year

Mid-fiscal year

Throughout

fiscal year

Throughout

fiscal year

Execute�investments�

and�divestitures,�

monitor�progress,�

and�manage�cash�

flows�throughout��

the�fiscal�year

Approve�and�

implement�

concrete�

measures�for�

improving�

business�

quality�and�

recycling�

assets

04

05

06

Evaluate�results�over�the�year�

and�determine�issues�to�be�

addressed�in�the�following�year

Project Development Energy�resource�and�infrastructure�

development�projects�are�advanced�

together�with�partners.�By�carefully�

monitoring�project�progress�and�flexibly�

responding�to�unforeseen�circum-

stances,�projects�are�completed�within�

the�planned�budgets�and�timeframes.

Risk Management

• Project management (budgets,

construction period, credit, contracts,

finances, environmental concerns, etc.)

Value Addition through

Operation and ManagementMitsui�plays�a�direct�role�in�operating�

businesses�and�managing�companies�in�

order�to�boost�their�competitiveness�and�

value.�Mitsui’s�functions�are�utilized�to�

this�extent�by�appointing�professionals�

who�are�highly�specialized�in�the��

respective�business�area,�dispatching��

our�diverse�group�of�professionals,�and�

pursuing�close�coordination�between�

Mitsui�and�individual�businesses.�Furthermore,�inter-business�collaboration��

is�promoted�to�help�Mitsui�explore�new�markets�and�business�models.

Risk Management

• Monitoring of and response to market conditions, competition, and other

operating environment changes

• Tracking of facility operation ratio and income and expenditure trends and

responding to any issues

• Management of risks related to factors including finances, taxation, labor,

legal affairs, credit, and the environment


• Confirmation of effectiveness of internal controls

• Appropriate asset value assessments and timely and appropriate accounting treatments

Strategic Asset RecyclingBusinesses�we�have�invested�in�are�

continually�evaluated�based�on�growth�

potential,�the�ability�to�increase�value�

with�Mitsui’s�functions,�and�strategic�

benefits.�If�it�is�deemed�that�a�business’�

viability�is�beginning�to�peak,�we�will�

consider�new�strategies,�such�as�merg-

ing�businesses�into�other�companies,��

or�the�possibility�of�asset�recycling,��

and�then�put�these�plans�into�effect.


• Stringent adherence to portfolio

management cycle

As�one�of�the�advisory�bodies�to�the�Corporate�Management�

Committee,�the�Company�has�established�the�Portfolio�

Management�Committee�to�establish�portfolio�strategy,�

formulate�investment�and�loan�planning,�and�provide�

portfolio�monitoring.�In�addition,�this�committee�reports�

such�information�to�the�Board�of�Directors�on�a�regular�basis.

• Establishment of a strategy for the overall portfolio

of Mitsui

Specify�priority�areas�and�areas�of�focus,�new�target�areas,�

and�areas�that�need�to�be�reviewed,�in�view�of�the�overall�

strategy�of�Mitsui,�the�individual�strategies�of�operating�

units,�market�trends�and�macro�analyses,�and�the�allocation�

of�its�management�resources.

• Establishment of investment and finance policies

Establish�important�policies�relating�to�the�management��

of�the�overall�portfolio�of�Mitsui�such�as�guidelines�for�

investment�and�finance�limits,�the�design�of�a�consolidated�

capital�cost�structure,�etc.

• Regular monitoring of Mitsui’s overall portfolio

Review�regularly�to�confirm�the�significance�of�all�business�

holdings�in�addition�to�confirming�the�appropriateness�of�

asset�size�in�accordance�with�each�business�area�and�country.

FOCUS The Portfolio Management Committee’s Role and Yearly Cycle of Portfolio Management

*3.�Withdrawal�standard�cutoffs�include�risk-return�ratio,�core�operating�cash�flow,�insolvency�indicators,�and�other�profitability�standards�as�well�as�qualitative�standards.

1 2 3 4 5


Enhancing�Management�Capital�1

The�individual�builds�the�business,��

and�the�business�cultivates�the�individual

As�the�first�president�of�the�former�Mitsui,�Takashi�Masuda,�stated,�“Mitsui�has�a�pool�of�very�talented�individuals.��

This�is�Mitsui’s�most�important�asset.”�We�believe�that�human�resources�are�our�greatest�asset.�There�is�an�extremely�

diverse�group�of�talented�professionals�working�at�the�Group,�including�at�affiliated�companies�around�the�world,�

and�continually�maintaining�and�expanding�this�strong�pool�of�talent�will�always�be�a�key�management�focus.

� Through�promoting�a�level�playing�field,�we�aim�to�strengthen�each�individual,�build�a�full-strength�team�of��

professionals,�and�also�draw�out�the�latent�potential�of�our�professionals�to�the�full.�At�the�same�time,�we�promote�

optimum�talent�among�our�strong�pool�of�human�resources.

Diverse pool

of talented

professionals

Our�employees�have�the�necessary��

qualities�and�capabilities�to�take�the��

initiative�to�create�and�develop�new��

businesses�and�create�new�value��

around�the�world�by�leveraging�their��

various�expertise.

Leveraging our

long-cultivated

management

capital

◦��Comprehensive�strengths

◦��Client�base�and�business�partner�

relationships

◦��Financial�base�and�fund�procurement�

capabilities

◦��Insight,�know-how,�and�judgment�

capabilities

◦��Ability�to�organize�and�manage�projects

Sustainably

Creating New Value

through Proactive

Business Creation

◦��Strengthening��

existing�businesses

◦��Improving��

business�value

◦��Reinforcing��

the�value�chain

◦��Establishing��

new�businesses

[2] Through�direct��

experience�in��

tumultuous,�high-�

pressure,�and�make-�

or-break�situations�

further�enhancing�

“Strong�Individuals”

[1]� �Accumulating�added�

value�created�through��

the�establishment�of��

new�businesses�as��

management�capital��

and�investing�this�capital�

to�further�promote�the�

value�creation�process

Realizing all

of the above

efforts at a

rapid pace

Human Capital

[2]

[1]


Framework for Encouraging the Active Role of Our Diverse Pool of Talented ProfessionalsThe�individual�builds�the�business,��

and�the�business�cultivates�the�individualRe-allocation of Human Resources

Mitsui�believes�that�direct�experience�in�tumultuous,�high-pressure,�and�make-or-break�situations�is�an��

essential�part�of�strengthening�the�individual.�We�are�actively�promoting�a�significant�shift�in�our�corporate�

personnel�to�the�business�frontlines�as�part�of�our�initiatives�to�have�our�employees�utilize�various�experiences�

to�the�full�as�well�as�our�efforts�to�maximize�our�organizational�strengths.�In�the�fiscal�year�ended�March�31,�

2018,�we�transferred�over�70�people�from�administrative�units�to�business�units�and�affiliated�companies��

with�the�aim�of�strengthening�our�earnings�power�on�a�companywide�basis.�We�intend�to�continue�this�

initiative�during�the�fiscal�year�ending�March�31,�2019.�At�the�same�time,�we�are�actively�pursuing�digital�

transformation�on�the�corporate�side,�from�where�we�are�dispatching�these�employees,�equipping�smaller�

teams�to�operate�with�a�high�degree�of�sophistication.

Training and Transfer to Japan

National�staff�(NS)�personnel�selected�for�training�as��

next-�generation�leaders�are�sent�to�Japan�to�learn�and��

experience�a�variety�of�things.�They�are�given�opportuni-

ties�to�study�the�Japanese�language�and�Japanese��

business�practices�and�experience�Japanese�work�styles,�

while�learning�other�aspects�of�Japan,�such�as�its�culture�

and�history.�Their�training�is�targeted�toward�their��

development�as�management�personnel�who�will�one�

day�play�key�roles�in�Mitsui’s�Global�Group�management.�

In�addition�to�opportunities�to�network�with�people�

within�and�beyond�Mitsui,�the�program�is�also�designed�

to�enable�participants�to�build�lifelong�relationships�by�inspiring�and�being�inspired�by�other�talented�people�

who�are�gathered�in�Japan�for�the�same�purpose.�A�total�of�159�people�have�participated�in�various�training�

programs�in�Japan�since�the�fiscal�year�ended�March�2014.�Mitsui�will�continue�to�implement�these�programs�

going�forward.

Persons

0

25

20

15

10

5

3

8

14

22

24

19

14

1

2

2

22

14

44

13

5

1

3 3

61

410

5

1817161514

As of March 31

Number of NS Employees

Transferred between

Overseas CountriesPersonnel Sent to Japan

Persons

1817161514

0

50

40

30

20

10

11

3840

30 30

21

18

9

13

14

13

13

8

9

7

10

131

10*

10

As of March 31

Number of NS GMs

Persons

0

75

60

45

30

15

20

38

46 46

52

64

2

2

14

18

4

4

20

18

6

4

18

20

8

4

20

25

11

6

22

1817161514

As of March 31

�Japan�Language�and�Business�Program�(LBP)

�Business�Integration�Program�(BIP)

�NS�transfers

*��Including�one�NS�transferee�accepted�by�an�

affiliated�company

�Americas

�EMEA

�Asia�Pacific

�Other

�Americas

�EMEA

�Asia�Pacific

�Other

1 2 3 4 5


Enhancing�Management�Capital�2

Through�interactive�communication�with�our�various�

stakeholders,�each�of�Mitsui’s�employees�and�officers��

is�endeavoring�to�acquire�a�firm�understanding�of�what�

society�expects�from�and�requires�of�Mitsui.�Based�on�

this�understanding,�we�strive�to�respond�to�changes��

in�market�environments�and�contribute�to�resolving�

social�issues�through�our�business�activities.

Shareholders and Investors

We�strive�for�continuous�improvement�of�our�corporate�value�

and�appropriate�market�recognition�by�fulfilling�transparency�

and�accountability�in�management�with�timely�and�accurate�

disclosure�of�information,�and�by�engaging�in�interactive�

communication�with�shareholders�and�investors.

Engagement�Methods

General�meetings�of�shareholders

IR�meetings�(presentations�on�financial�results,�Investor�Day,�

briefings�for�individual�investors)

Separate�engagement�for�IR�and�SR�(departments�in�charge�of�

exercising�voting�rights�and�responsible�investment)

Securities�Report

Integrated�Report

Newsletter�to�Shareholders

Mitsui�&�Co.�websites

Surveys�from�ESG�research�organizations

Employees

Through�promoting�working�style�reforms�and�a�level�playing�

field�for�our�people�globally,�we�will�build�a�full-strength�team�

of�professionals�and�enhance�diversity.�We�aim�to�draw�out�

the�latent�potential�of�our�professionals�to�the�full.


Intranet

In-house�newsletter�of�Mitsui�&�Co.

Roundtable�Meetings,�New�Active�Talk�Wednesday��

(dialogue�between�management�and�employees,�as�well�as�

among�employees)

Diversity�Cafe

Training�programs�and�seminars;�Opinion�surveys

Mitsui�Environment�Month

Activities�under�the�Mitsui�Global�Volunteer�Program

Volunteer�Activity�Leave

In-house�and�external�whistle-blowing�channels

Discussions�with�labor�unions

Timely and accurate

disclosure of information

Collaboration to

meet social needs

Strengthening

of each individual

CASE Mitsui × Partner

Going�beyond�the�supply�of�materials,�Mitsui�will�provide�

assistance�to�Gestamp�by�proposing�new�materials,�pro-

moting�a�shift�to�smart�factories�that�leverage�IT,�expanding�

sales�to�Japanese�automotive�manufacturers,�and�helping�

to�continue�to�improve�efficiency�in�the�distribution�of�

materials�and�components.�In�addition�to�contributing�to�

improvement�in�Gestamp’s�corporate�value,�these�efforts�

will�help�Mitsui�expand�its�ancillary�equipment�business.

Helping grow sales to

Japanese companies

Pursuing new

materials and

components

businesses

Expanding transactions

with companies in

Europe and the Americas

Steel�material�supply

Material�supply

IoT

Logistics

Business�cultivation

Business��

areas��

thus�far

Engagement�for�business�creationRelationship Capital

Clients and Business Partners

We�endeavor�to�acquire�a�firm�understanding�of�what�clients�

and�business�partners�expect�from�and�require�of�Mitsui,�

whose�businesses�are�becoming�more�diverse�and�complex.�

In�addition�to�providing�our�business�partners�and�associates�

with�various�functions�in�a�proactive�manner,�we�also�work��

to�resolve�various�issues�in�the�supply�chain�while�giving�

consideration�to�the�end�consumer�and�to�ensuring�the��

safety�and�security�of�products�and�services.


Engagement�that�occurs�regularly�in�the�ordinary�course�of�

business

Mitsui�&�Co.�websites

Corporate�Brochure�/�Advertisements�/�TV�commercials

Sustainability�Report

Activities�based�on�the�Supply�Chain�CSR�Policy

Supplier�questionnaire�and�on-site�surveys


NPOs and NGOs

We�endeavor�to�establish�networks�with�various�NPOs�and�

NGOs�and�gather�opinions�regarding�environmental�and�

societal�issues.�At�the�same�time,�we�pursue�collaboration��

with�NPOs�and�NGOs�to�resolve�these�issues.


Discussions�and�local�visits�for�cooperation�with�NPOs��

and�NGOs

Participation�in�seminars�hosted�by�NPOs�and�NGOs

Responses�to�questionnaires�from�NPOs�and�NGOs

Local Communities

We�contribute�to�sustainable�development�through�our�

wide-ranging�business�activities�and�societal�contribution�

activities�in�countries�and�regions�throughout�the�world.��

We�also�aim�to�achieve�harmonious�coexistence�with�local�

communities�through�contributions�in�such�areas�as�local�

industry�development,�creation�of�employment�opportuni-

ties,�and�the�establishment�of�infrastructure,�as�well�as�

improvements�in�the�daily�lives�of�local�residents.



business

Engagement�undertaken�for�a�particular�purpose,�such�as�

large-scale�resource�development

Contribution to

nation building

Collaboration to

resolve social issues

Coexistence with

local communities

CASE Mitsui × Government Bodies

Leveraging�the�solid�trust-based�relationships�we�have�

with�local�governments�and�major�global�companies,��

we�have�cultivated�a�competitive�edge�in�resource��

development�over�many�years.�By�combining�this��

competitive�edge�with�the�experience�and�knowledge��

we�have�gained�in�the�infrastructure�domain,�we�are�

contributing�to�the�economic�development�of�countries�

around�the�world�in�such�ways�as�promoting�industry,�

establishing�infrastructure,�and�creating�jobs.

CASE Mitsui × Local Communities

We�have�invested�in�ETC�Group�Limited,�which�has�

adopted�“if�farmers�grow,�we�grow�too”�as�one�of�its�

credos.�Through�this�investment,�we�will�provide�farming�

advice�and�leverage�our�crop�trading�network�and�other�

functions�with�the�aim�of�reinforcing�our�profit�base�in�

Africa�and�in�nations�bordering�the�Indian�Ocean.

Establishing new profit pillars and

contributing to nation building

1 Resource development 2 Rail and port infrastructure

Vast�reserves�and�superior�

price�competitiveness

Model�for�stable�earnings,�

potential�for�expansion

� �Establishment��

of�railways�in�the��

Nacala�Corridor

2

2 � �Construction�of�terminals��

at�the�Port�of�Nacala

� �Moatize�coal��

mine�project

1

Provision of functions such as

our crop trading network

Efforts to grow

in the African market

1 2 3 4 5

Government Bodies

We�are�committed�to�compliance�with�related�laws�and�

regulations�formulated�by�government�agencies�and�local�

governments�in�the�countries�where�we�engage�in�business�

activities.�Furthermore,�through�cooperation�with�govern-

mental�agencies�and�local�governments,�we�firmly�entrench�

ourselves�in�the�local�industrial�structure.�In�order�to�create�

businesses�that�play�a�key�role�in�each�country�and�region��

of�operation,�we�aim�to�contribute�to�nation�building�and�

industrial�promotion�in�a�highly�unique�manner.


Participation�in�policy�councils

Participation�in�consultation�and�advisory�meetings��

with�government�agencies�and�offices

Training�programs�for�local�government�bodies

Activities�through�business�and�industry�groups


business

Engagement�undertaken�for�a�particular�purpose,�such�as�

large-scale�resource�development


Efforts�to�Address�Climate�Change�through�Our�Business

Governance

Strategy

The actions of corporations to address climate change are becoming more and more important for realizing a

sustainable society. This importance is highlighted by such factors as the adoption of the Sustainable Development

Goals (SDGs) and the Paris Agreement by the United Nations as well as the announcement of risk management

guidelines by the Task Force on Climate-related Financial Disclosures.

Mitsui has adopted the protection of the global environment as one of its material issues, “Protection of the Global

Environment,” in recognition of the adverse impact that climate change and other global environmental changes

have on the sustainable growth of Mitsui and society as a whole. Meanwhile, the response to climate change

provides us with new business opportunities, including low-carbon energy, eco-friendly infrastructure and products,

and innovative services that make extensive use of digital technologies. We believe that the sustainable growth of

society cannot be realized without economic development and measures to address climate change. Accordingly,

we will leverage the comprehensive strengths of the Mitsui’s Global Group to achieve sustainable growth for society

through collaboration with our various stakeholders.

Examples of Mitsui & Co.’s Initiatives

1 Natural Gas and LNG Businesses

Natural�gas�has�a�relatively�low�amount�of�

greenhouse�gas�emissions�compared�

with�other�fossil�fuels.�Accordingly,�

demand�for�natural�gas�as�a�clean�energy�

source�is�increasing�around�the�world.�

Since�the�1970s,�Mitsui�has�been�invest-

ing�in�LNG�businesses�in�the�Middle�East,�

Australia,�Southeast�Asia,�and�other�

regions.�Through�these�investments,�we�

have�been�extensively�involved�in�the�

LNG�supply�chain,�from�production�to�

marketing,�and�have�contributed�to�a�

sustainable�supply�of�natural�gas�and�LNG.

2 Power Generation Businesses

That Use Renewable Energy

Mitsui’s�Company-owned�power�generat-

ing�capacity�is�9.3GW�(as�of�March�31,�

2018),�and�renewable�energy�sources,�

including�hydroelectric�power,�account�

for�16%�of�this�amount.�We�have�adopted�

a�target�of�increasing�this�percentage�to�

30%�by�2030.�To�work�in�tandem�with�this�

target,�we�are�taking�steps�to�gradually�

lower�our�percentage�of�coal-fired��

thermal�power,�which�has�a�high��

environmental�impact.

3 Initiatives toward New

Technologies

To�respond�to�the�increasing�demand�for�

energy,�and�to�pursue�efforts�to�address�

climate�change,�we�are�engaging�in�a�

pilot�project�in�the�supply�chain�for��

hydrogen,�which�is�expected�to�be��

utilized�as�a�form�of�next-generation�

energy,�and�undertaking�initiatives�

toward�new�technologies,�including�

carbon�capture�and�storage�technologies.

To�serve�as�an�organization�that�operates�under�the�Corporate�

Management�Committee,�we�established�the�Sustainability�

Committee,�which�comprises�directors,�executive�officers,��

and�the�general�managers�of�each�relevant�corporate�staff�

division.�The�Sustainability�Committee�engages�in�such�efforts�

as�collecting�information�related�to�the�sustainability�of�Mitsui’s�

businesses,�conducting�monitoring�activities,�and�submitting�

proposals�to�the�Corporate�Management�Committee.�In��

addition,�the�committee�collaborates�with�the�Headquarter�

Business�Units�to�identify�business�risks�and�opportunities�

pertaining�to�climate�change�and�monitor�the�status�of��

our�frontline�response�to�climate�change.�At�the�same�time,��

the�committee�promotes�activities�to�respond�appropriately��

to�the�demand�for�information�disclosure�from�external��

stakeholders.�The�details�on�discussions�held�at�meetings�of��

the�Sustainability�Committee�are�reported�regularly�to�the��

Corporate�Management�Committee�and�the�Board�of�Directors.�

These�details�are�then�used�to�help�determine�the�future�

direction�of�our�management.

We�identify�business�risks�and�opportunities�by�Headquarter�

Business�Units�and�formulate�strategies�for�sustainable�growth�

accordingly.�While�working�to�fulfill�important�missions�for�

Mitsui,�such�as�“Stable�Supply�of�Resources�and�Materials”�and�

“Enhancement�of�Local�Industrial�Bases�and�Quality�of�Life,”�

we�are�making�concerted�efforts�to�enhance�the�operational�

efficiency�of�our�existing�businesses�and�promote�the�develop-

ment�of�innovative�new�technologies�and�business�models.�

Through�these�means,�we�are�taking�on�the�challenge�of�real-

izing�both�economic�development�and�a�low-carbon�society.

Accelerating Our Response to Climate Change

Simultaneously Pursuing Economic, Social, and Environmental Value

Sakhalin�II�LNG�projectⒸ Sakhalin�Energy

Bii�Stinu�wind�project Hydrogen�supply�chain�projectSource:�Chiyoda�Corporation


Risk Management

Efforts Related to Greenhouse Gas Emissions

We�have�been�conducting�a�survey�of�our�greenhouse�gas�

(GHG)�emissions�from�the�fiscal�year�ended�March�31,�2006,��

in�Japan�and�the�fiscal�year�ended�March�31,�2009,�overseas.�

� In�the�fiscal�year�ended�March�31,�2018,�GHG�emissions�from�

the�Head�Office,�Company�offices�and�branches,�and�domestic/�

overseas�subsidiaries�came�to�0.66�million�tons.�Further�more,�

GHG�emissions�from�un-incorporated�joint�ventures�in�the�metal�

resource�and�energy�field�totaled�3.32�million�tons.�As�a�result,�

total�GHG�emissions�came�to�3.99�million�tons�(see�page�035).

� Meanwhile,�in�addition�to�owning�and�maintaining�forests�

that�accumulate�and�absorb�CO2,�we�are�working�to�ease�our�

total�GHG�emissions�in�such�ways�as�participating�in�the�Jirau�

run-of-the-river�hydropower�project�in�Brazil,�which�has�

received�approval�from�the�United�Nations�for�annual�carbon�

credits�of�6�million�tons.

� Also,�we�have�adopted�a�target�to�reduce�the�annual�

amount�of�energy�consumed�by�1%�at�our�Head�Office�as��

well�as�at�our�domestic�offices�and�branches�and�domestic�

subsidiaries.

Mitsui’s Forests

Passing on an abundance of forests to the next

generation with the aim of realizing a sustainable society

We�own�forests�in�74�locations�that�cover�a�total�of�444�km2�

(44,417�hectares),�which�is�roughly�0.1%�of�Japan’s�total�

land�area.�Taking�into�account�the�public�value�offered�by�

forests,�we�have�maintained�and�managed�our�forests�

over�many�years.�In�addition,�all�of�our�forests�have�

obtained�the�FSC®�certification�(license�number:�

FSC®C057355)�and�SGEC�certification,�which�are�both�

international�standards.�It�is�also�estimated�that�Mitsui’s�

forests�accumulate�and�absorb�roughly�560,000�tons��

of�CO2�per�year.*�These�factors�demonstrate�how�we��

contribute�to�the�mitigation�of�

climate�change-related�risks�

through�responsible�forest�

management.

*��Based�on�in-house�calculations�that�

referenced�“IPCC�Guide�lines�for�National�

Greenhouse�Gas�Inventories”�Tier�1

Major Climate Change-related Risks and Their Impact on Mitsui’s Businesses

To�address�the�following�climate�change-related�risks,�which�have�the�potential�to�adversely�impact�Mitsui’s�businesses,�we�are�

transitioning�to�a�portfolio�with�a�high�risk�tolerance�in�each�business�field.�In�addition,�we�are�closely�monitoring�government�

policies,�laws,�and�regulations�in�each�country�of�operation�and�working�to�provide�new�products�and�services�that�give�consideration�

to�a�low-carbon�society.�Through�these�means,�we�are�preparing�ourselves�to�respond�to�potential�risks�should�they�occur.

Transition�Risks

Policy�and��

Legal

Decrease�in�demand�for�fossil�fuels�and�impairment�to�Mitsui’s�stake�in�fossil�fuel�businesses�resulting�from�the�transition�to�using�

energy�with�low�carbon�emissions

Adverse�impact�on�the�profitability�of�Company-owned�assets�resulting�from�such�factors�as�changes�in�the�energy�and�power�

source�mix�due�to�government�policies�in�each�country�and�the�introduction�of�new�laws�or�regulations

Technology Adverse�impact�on�the�supply�and�demand�of�existing�products�and�services�due�to�the�introduction�of�new�technologies�that�

respond�to�climate�change

Market Risks�that�affect�the�procurement�of�funds�for�business�promotion�resulting�from�low-carbon�policies�of�financial�institutions�and�

insurance�companies

Physical�Risks Impediment�of�operations�at�operating�companies�in�Australia,�the�U.S.,�and�other�regions�due�to�cyclones�and�hurricanes

We�have�classified�businesses�with�a�high�level�of�environmen-

tal�impact�as�“specially�designated�businesses”�and�are�working�

to�formulate�measures�to�address�the�environmental�impacts�

that�accompany�these�businesses.�We�are�also�making�efforts�to�

examine�the�compliance�of�the�specially�designated�businesses�

with�environmental�regulations�and�guidelines�and�to�minimize�

risks�starting�from�the�stage�of�project�incubation�(Specially�

Designated�Business�Management�System).�Furthermore,��

we�have�established�the�Environmental�&�Societal�Advisory�

Committee,�which�functions�as�an�advisory�body�to�the�Sustain-

ability�Committee.�Composed�of�attorneys�and�other�external�

experts,�the�Environmental�&�Societal�Advisory�Committee�

takes�steps�to�improve�the�quality�of�Mitsui’s�projects�from�an�

objective�and�highly�specialized�perspective.

� In�the�promotion�and�management�of�each�business,�we�

bear�in�mind�the�various�climate�change�scenarios�that�are�

offered�by�internationally�recognized�organizations,�such�as�the�

International�Energy�Agency,�and�analyze�the�impact�of�such�

scenarios�on�our�businesses.�Additionally,�as�we�are�a�company�

that�develops�businesses�all�over�the�world,�the�climate�

change-related�policies�of�each�country�have�a�significant�

impact�on�the�profitability�and�sustainability�of�each�individual�

business.�We�therefore�make�full�use�of�the�global�network��

we�have�established�through�our�business�activities�over�many�

years�to�promptly�gain�an�understanding�of�the�policies�of��

each�country�of�operation�as�well�as�the�stakeholder�trends�that�

could�impact�such�policies.�This�understanding�is�then�utilized�

in�our�decision-making�process.

� We�undertake�initiatives�in�a�broad�range�of�diverse�busi-

nesses.�Accordingly,�we�are�continuously�revising�our�portfolio�

with�an�awareness�of�enhancing�our�tolerance�to�climate�

change-related�risks.�We�are�also�taking�on�the�challenge�of�

flexibly�capturing�business�opportunities�that�leverage�our�

expansive�business�development.

Improving Risk Tolerance and Capturing New Growth Opportunities

For more information on our environmental data,

please�see�page�33�of�Sustainability Report 2018.


Message�from�the�Chairperson��

of�the�Sustainability�Committee

We�will�drive�our�business�with�an�increased�focus��

on�ESG�(environmental,�social,�and�governance)�aspects��

in�line�with�our�identified�Materiality,�and�embody��

our�corporate�slogan,�“360°�business�innovation.”��

By�doing�so,�we�will�create�outstanding�business��

that�benefits�Japan�and�the�world.

Satoshi�Tanaka

Representative�Director,��

Executive�Vice�President

Chief�Administrative�Officer�(CAO)

Chief�Information�Officer�(CIO)

Chief�Privacy�Officer�(CPO)


Mitsui�acknowledges�companies�can�only��

be�sustainable�if�the�societies�they�operate�in��

are�sustainable.�We�want�to�fulfill�our�social�

responsibilities�by�the�sustainable�growth�of��

our�own�company,�in�order�to�contribute�to�the�

realization�of�a�sustainable�society�through�our�

business�activities.

� Mitsui�has�been�accurately�identifying�society’s�

expectations�and�societal�issues�through�dialogue�

with�various�stakeholders,�and�enhancing�our�

capabilities�and�functions�to�meet�the�expecta-

tions�of�society.�Takashi�Masuda,�the�first��

president�of�the�former�Mitsui,�stated,�“Let�not�

short-term�gains�tempt�your�mind,�seek�only�

enduring�prosperity�by�embracing�grand�aspira-

tions.”�That�commitment�to�stay�focused�on�the�

future�and�pursue�the�sustainability�of�society�

and�business�has�remained�part�of�our�heritage�

down�to�the�present�day.�As�a�company�engaged�

in�business�operations�on�a�global�scale,�we�

believe�that�it�is�our�mission�to�contribute�to�the�

creation�of�a�sustainable�society�through�our�

business�activities.

� In�2004,�the�Company�made�a�declaration��

to�the�inter�national�community�of�its�commit-

ment�to�put�these�concepts�into�practice�by�

signing�and�pledging�its�support�for�the�UN�

Global�Compact,�a�charter�of�voluntary�principles�

for�businesses�and�institutions�concerning��

human�rights,�labor,�the�environment,�and�anti-�

corruption.�We�strive�to�implement�the�provisions�

of�the�Global�Compact�and�are�committed�to�stay�

focused�on�the�future.�In�2015,�we�identified�five�

material�issues�which�are�relevant�to�all�aspects�

of�our�business�activities.�Based�on�a�medium-�

and�long-term�perspective,�we�assess�potential�

risks�and�opportunities�that�arise�from�the��

influences�brought�by�those�identified�five��

material�issues.��

� In�2017,�the�Company�established�the�Sustain-

ability�Committee�under�the�Corporate�Manage-

ment�Committee�with�the�aim�of�ensuring�that�

these�ideas�are�deeply�reflected�in�the�activities�of�

Mitsui.�For�the�fiscal�year�ended�March�31,�2018,�

we�held�discussions�mainly�on�climate�change,�

covering�a�wide�range�of�topics�including�the�

direction�of�Mitsui’s�future�initiatives�and�

responses,�risk�management,�and�disclosure�

policies,�and�reported�the�results�to�the�Corporate�

Management�Committee�and�the�Board�of�Direc-

tors.�We�will�continue�to�plan,�formulate,�and��

make�proposals�for�advancing�management�

more�focused�on�the�sustainability�of�society��

and�Mitsui.

� Today,�problems�with�the�potential�to�threaten�

the�sustainability�of�both�the�global�environment�

and�society�are�occurring�on�a�global�scale,�

causing�heightened�unpredictability�and��

uncertainty�in�every�field�of�activity.�We�are�now�

in�an�era�in�which�we�must�use�various�options��

to�search�for�paths�to�the�future.�As�manifested��

in�the�adoption�of�the�Sustainable�Development�

Goals�(SDGs)�and�the�Paris�Agreement�by�the�

United�Nations,�corporations�are�expected�to�

enhance�corporate�value�and�maintain�a�strong�

focus�on�long-term�perspectives�and�social��

sustainability.�Because�of�these�changes,�we�

believe�that�we�need�to�sharpen�the�sensitivity��

of�the�antenna�that�we�have�developed,�in�order�

to�fulfill�our�corporate�mission�of�contributing��

to�the�creation�of�a�sustainable�society�through�

our�business�activities.

� Mitsui�will�contribute,�through�its�wide-ranging�

global�business�activities,�to�solutions�to�global�

issues,�such�as�economic�and�social�development�

in�various�countries�and�regions�and�climate�

change.�We�will�work�to�promote�a�better�under-

standing�of�our�business�activities�by�informing�the�

world�about�our�strengths�and�vision,�so�that�we�

can�earn�the�trust�of�all�our�stakeholders,�including�

our�customers,�business�partners,�and�govern-

ments�and�local�communities�in�the�countries�

where�we�do�business,�as�well�as�our�investors.

� While�we�continue�to�strive�not�only�to�fulfill�our�

social�responsibilities,�we�will�drive�our�business�

with�an�increased�focus�on�ESG�(environmental,�

social,�and�governance)�aspects�in�line�with�our�

identified�Materiality,�and�embody�our�corporate�

slogan,�“360°�business�innovation.”�By�doing�so,�

we�will�create�outstanding�business�that�benefits�

Japan�and�the�world�and�enhances�our�corporate�

value,�and�contribute�to�the�realization�of�a�

sustainable�future�where�the�aspirations�of��

people�can�be�fulfilled.


Our ProgressCHAPTER 2


034 Performance Highlights

036 CFO Message

042 Progress of Medium-term

Management Plan

046 Results of Initiatives

� 046� �Case�1:�Establishing�Selected��

New�Growth�Areas

� 048� �Case�2:�Promoting�the�Digital��

Transformation�Strategy

� 050� �Case�3:�Main�Results�of�Our�Efforts��

toward�Sustainability

Our ProgressCHAPTER 2


Performance�Highlights

Profit (Loss) for the Year Attributable

to Owners of the Parent / ROE 123

�Profit�(loss)�for�the�year�attributable�to�owners�of�the�parent

�ROE�(right�scale)

*� Cash�flows�from�operating�activities�minus�cash�flows�from�changes�in��

working�capital

¥ billion %

14 15 16 17 18

10.9

8.67.7

9.7

‒2.2

418.5

306.1

‒83.4

306.5

350.1

‒200

‒100

0

100

200

300

400

500

‒10

‒5

0

5

10

15

20

25

Years ended March 31

Total Assets / Net DER 2 Total Shareholder Return Amount / Total Shareholder

Returns as a Percentage of Core Operating Cash Flow* 3

Core Operating Cash Flow* 13

�Current�assets　 �Non-current�assets　 �Net�DER�(right�scale) �Total�shareholder�return�amount

�Total�shareholder�returns�as�a�percentage�of�core�operating�cash�flow�(right�scale)

*�Amount�of�shareholder�returns�divided�by�Core�operating�cash�flow

14 15 16 17 18

0.78

0.88

0.95

0.820.83

7.0 7.16.6

7.57.0

4.24.54.3

4.7

4.5

0

2

4

6

8

10

12

14

0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

¥ trillion

As of March 31

Times %

14 15 16 17 18

2629

24

17

26

0

25

50

75

100

125

150

175

0

5

10

15

20

25

30

35172.5

145.0

115.0115.0

160.0

¥ billion


14 15 16 17 18

0

100

200

300

400

500

600

700

666.5

494.8

661.6

608.9

471.7

¥ billion



�Crude�oil　 �Gas　

�Coking�coal　 �Thermal�coal　

Power Generating

Capacity (Gross) 14

Equity Share of Production 14

Female Managerial Staff*1 /

Female Employees Dispatched

Overseas*2 45

Greenhouse Gas (GHG)

Emissions 4

�Female�managerial�staff　

�Female�employees�dispatched�overseas

*1.�Non-consolidated,�as�of�July�1�(2015–2017)

*2.��Overseas�trading�subsidiaries,�as�of�April�1�

(2016–2018)

16 17 18

34

38 38


GW

10

20

40

30

0

KBoE/day

16 17 18 19(Forecast)

20(Forecast)

0

200

300

100

172.6 177 183173.1

168.0

71.2 74 7970.190.1

Years ended /

ending March 31

16 17 18

0

40

60

20

56.860.9 63

57.464

Mt/year

19(Forecast)

20(Forecast)

Years ended /

ending March 31

16 17 18

0

10

15

5

3.8

9.5

3.6

8.8

3.5

14

11

9.3

Mt/year

19(Forecast)

20(Forecast)

Years ended /

ending March 31

16 17 18

0

100

150

50

127.6

150159

124.6117.8

Kt/year

19(Forecast)

20(Forecast)

Years ended /

ending March 31

200

168

126

5058

61

15/16 16/17 17/18

Persons

50

100

200

150

0

16 17 18

664

3,321

3,985

642622

1,000t-CO2

1,000

2,000

4,000

3,000

0

Crude Oil & Gas

Coal

Iron Ore

Copper

Maintain�robust,�sustainable�earnings�growth�� 1

Boost�asset�and�capital�efficiency�� 2

Continually�increase�shareholder�value�� 3

Create�social�and�environmental�value�� 4

Improve�human�resource�capabilities�� 5

Added�the�

Un-Incorporated��

J/V�in�Mineral�&�

Metal�Resources��

and�Energy�sectors�

since�the�fiscal��

year�ended��

March�31,�2018

Scope:�Greenhouse�gas�emissions�of�the�Company,��consolidated�subsidiaries,�and�un-incorporated�joint�ventures�in�Mineral�&�Metal�Resources�and�Energy�sectors�(Scope�1�and�Scope�2,�includes�gas�generated�at�times�of�production)

�The�Company�and�subsidiaries

��Un-incorporated�joint�ventures�in�Mineral�&�

Metal�Resources�and�Energy�sectors


CFO�Message

Results for the fiscal year ended

March 31, 2018

Looking�back�on�the�business�environment�during�

the�fiscal�year�ended�March�31,�2018,�the�global�

economy�saw�ongoing�gradual�growth�in�both�devel-

oped�countries�and�emerging�countries�supported�

by�firm�spending�and�investment.�In�this�favorable�

environment,�we�achieved�strong�earnings�in�

�Resources�&�Energy�and�also�saw�steady�growth�in�

non-resource�areas�such�as�Iron�&�Steel�Products�

and�Machinery�&�Infrastructure.�Furthermore,�we�

made�good�progress�on�the�key�initiatives,�and�

overall�we�made�a�solid�start�along�the�road�to�

achieving�the�targets�of�our�medium-term�man-

agement�plan�for�the�year�ending�March�31,�2020.

� Profit�for�the�year�attributable�to�owners�of�the�

parent�was�¥418.5�billion,�and�compared�with�the�

previous�fiscal�year�ended�March�31,�2017,�we�

had�a�large�increase�in�earnings�by�¥112.4�billion.�

Along�with�this�growth�in�profit,�ROE�reached�

10.9%,�exceeding�the�10%�target�of�our�medium-

term�management�plan.�Core�operating�cash�flow�

was�the�highest�ever�at�¥666.5�billion�(an�increase�

of�¥171.7�billion�year�on�year),�supported�by�

strong�business�results�and�an�increase�in��

dividends�from�equity-method�affiliates.

� In�addition�to�increasing�the�annual�dividend��

for�the�fiscal�year�ended�March�31,�2018�to�¥70�

per�share�(an�increase�of�¥15�year�on�year),�we�

also�implemented�share�buybacks�totaling�¥50.0�

billion.�Together,�these�initiatives�represented�a�

total�return�to�shareholders�of�approximately�

¥172.5�billion� Chart 1 .�Please�also�note�that�in�

April�2018�we�canceled�approximately�54�million�

shares,�equivalent�to�around�3%�of�issued�shares.�

For�the�fiscal�year�ending�March�31,�2019,�we�

forecast�our�dividend�at�¥70�per�share,�but�our�

policy�is�to�continue�initiatives�to�improve�our�

business�performance�and�achieve�sustained�

dividend�increases�and�ROE�of�10%�in�the�fiscal�

year�ending�March�31,�2020.

� The�global�economy�is�expected�to�follow�a�

trend�of�gentle�recovery�going�forward.�However,�

there�are�several�factors�that�careful�watch�

Cash�flow�focused�

management�is��

progressing�extremely��

well.�In�light�of�this,��

we�will�continue�efforts��

to�further�improve�our��

financial�base.

Takakazu�Uchida

Representative�Director,

Executive�Managing�Officer,

Chief�Financial�Officer�(CFO)


continues�to�be�needed�as�we�exert�all�our�efforts�

to�manage�Mitsui’s�business.�These�include�the�

escalation�of�geopolitical�risk�surrounding�the�

Middle�East,�the�future�prospects�for�the�European�

and�U.S.�economies,�which�have�shown�signs�of�

maturity�in�some�parts,�the�impact�of�the�Federal�

Reserve�Board’s�monetary�tightening�on�the�

economies�of�emerging�countries,�and�trends��

in�U.S.�trade�policy.

Basic Approach to Financial Strategy

Mitsui’s�basic�financial�policy�is�to�secure�the�

liquidity�and�maintain�the�sound�financial�base�

needed�to�support�the�growth�strategy�for�our�

diverse�business�portfolio�centered�on�core�areas.�

In�funding,�we�focus�particularly�on�liquidity�and�

stability.�For�this�reason,�in�principle�our�funding�

procurement�is�based�on�funding�periods�of�10�

years�plus�using�long-term�borrowings�or�bond�

issues,�aiming�to�minimize�refinancing�risk.�

� We�also�work�to�reduce�risk�in�large-scale��

projects,�actively�using�financial�programs�provided�

by�the�export�credit�agencies�of�various�countries�

and�project�finance.�We�place�critical�importance�

on�planning�risk�prevention�from�the�outset,�

which�we�can�achieve�by�seeking�participation�

from�government�financial�agencies�or�multilat-

eral�agencies�so�that�our�projects�are�recognized�

at�the�intergovernmental�level.�This�is�particularly�

evident�in�how�we�closely�address�country�risks�in�

emerging�markets.�

� Furthermore,�we�operate�a�global�cash�manage-

ment�system�(CMS)�aimed�at�maximizing�funding�

efficiency�throughout�our�consolidated�group.�In�

this�system,�funding�procurement�is�in�principle�

centered�on�the�Company�or�its�financial�subsid-

iaries,�creating�an�in-house�banking�process�in�

which�funding�can�be�procured�and�surpluses�

deployed�in�each�region�according�to�need.�

Currently�our�CMS�encompasses�more�than��

200�companies.

Progress of Cash Flow Focused

Management

During�our�previous�medium-term�management�

plan,�we�introduced�a�cash�flow�allocation�frame-

work.�Our�purpose�was�to�drive�the�implementa-

tion�of�our�growth�strategy�while�maintaining�and�

strengthening�our�financial�foundation�by�making�

a�balanced�allocation�of�cash,�gained�from�operat-

ing�cash�flow�and�asset�recycling,�to�both�growth�

investments�and�shareholder�returns.�As�a�result,�

666.5

494.8 570.0

630.0

122.5100.0

47.5

145.0

97.5122.5

172.5

50.0

Years ended /

ending March 31

2017

Medium-term management plan

2018 2019 (forecast) 2020 (forecast)

¥70¥55Annual dividend per share ¥70 (plan)

(¥�billion)

�Dividend

�Share�buyback

�Core�operating�cash�flow*

*�Cash�flows�from�operating�activities�minus�cash�flows�from�changes�in�working�capital

Chart 1 Shareholder Returns

Minimum

total dividend

amount

¥100bn/year


CFO�Message

we�achieved�positive�free�cash�flow�during��

the�previous�medium-term�management�plan,�

and�realized�shareholder�returns�totaling��

¥375.0�billion,�including�share�buybacks.�

� During�the�current�medium-term�management�

plan,�we�are�making�more�progress�on�cash�flow�

focused�management�and�in�strengthening�the�

financial�base.�For�shareholder�returns,�we�set�a�

minimum�dividend�and�are�realizing�positive�free�

cash�flow�even�after�shareholder�returns.�Depend-

ing�on�the�business�environment,�such�free�cash�

flow�will�be�allocated�to�additional�shareholder�

returns,�repayment�of�interest-bearing�debt,�or�

additional�investment.�Meanwhile,�we�are�aiming�

to�maintain�a�credit�rating�of�A�or�higher.�

� In�the�fiscal�year�ended�March�31,�2018,�the�first�

year�of�the�current�medium-term�management�

plan,�core�operating�cash�flow�was�approximately�

¥670.0�billion,�reflecting�the�steady�increase�in�our�

business�performance�and�an�increase�in�divi-

dends�from�equity-method�affiliates.�Combined�

with�¥300.0�billion�obtained�from�progress�in�

asset�recycling,�this�produced�cash-in�of�¥970.0�

billion.�Furthermore,�through�strict�investment�

discipline,�investment�and�loans�were�kept�to�

¥560.0�billion,�and�with�total�shareholder�returns�

of�¥172.5�billion,�total�cash-out�was�¥732.5�billion.�

As�a�result,�free�cash�flow�after�shareholder�returns�

excluding�the�impact�of�fluctuations�in�working�

capital�and�time�deposits�was�¥237.5�billion,�

marking�very�good�progress.

� We�have�updated�our�three-year�cumulative�

plan�for�cash�flow�allocation�based�on�the�results�

of�the�fiscal�year�ended�March�31,�2018�and�the�

business�plan�for�the�fiscal�year�ending�March�31,�

2019� Chart 2 .�

� While�the�update�reflects�the�increase�in�core�

operating�cash�flow�and�additional�shareholder�

returns,�we�are�maintaining�our�three-year�cumula-

tive�investment�and�loans�amount�at�between�¥1.7�

trillion�and�¥1.9�trillion�as�announced�at�the�launch�

of�the�medium-term�management�plan,�due�to�

continued�investment�discipline.�Likewise,�there�is�

no�change�to�our�forecast�for�asset�recycling.�For�

shareholder�returns�for�the�fiscal�year�ending�

March�31,�2020,�we�are�drafting�a�three-year�

cumulative�plan�incorporating�only�the�minimum�

dividend�payment�announced�at�the�launch�of�the�

medium-term�management�plan.�Even�then,�the�

level�of�shareholder�returns�will�exceed�what�it�

was�under�the�previous�medium-term�manage-

ment�plan.�As�a�result�of�the�above,�we�have�

Chart 2 Outlook for Cash Flow Allocation (FY2018–FY2020)

Unit:�¥�billion

FY March 2018

Full-year results

3-year cumulative

(Updated in May 2018)

3-year cumulative

(Disclosed in May 2017)

Cash-In

Core�Operating�Cash�Flow*1・・・[1] 670.0 1,870.0 1,700.0

Asset�Recycling・・・[2] 300.0 700.0 700.0

Cash-Out

Investment�and�Loans・・・[3] –560.0–1,700.0～

–1,900.0

–1,700.0～

–1,900.0

Shareholder�Returns*2・・・[4] –172.5 –400.0 –300.0

Free�Cash�Flow*3�after�Shareholder�Returns*2�・・・[1]+[2]+[3]+[4] 237.5270.0～

470.0

200.0～

400.0

Additional shareholder returnsRepayment of

interest-bearing debtAdditional investment

Allocation

*1.�Cash�flows�from�operating�activities�minus�cash�flows�from�changes�in�working�capital

*2.�The�three-year�cumulative�(updated�in�May�2018)�column�is�calculated�on�a�minimum�total�dividend�of�¥100bn�for�FY�March�2020

*3.�Free�cash�flow�that�excludes�the�effects�of�changes�in�working�capital�and�time�deposits


03 05 06 07 08 0904 10 11 12 13 14 15 16 17 18 19 20

¥ billion US$

0

100

200

300

400

500

600

700

0

30

60

90

120

150

180

210

Years ended /

ending March 31(forecast) (forecast)

Chart 3 Core Operating Cash Flow*

�Core�operating�cash�flow　 �Iron�ore�(right�scale)　 �Crude�oil�(JCC)�(right�scale)

*�Cash�flows�from�operating�activities�minus�cash�flows�from�changes�in�working�capital

shifted�upward�the�range�of�the�three-year�cumu-

lative�plan�for�free�cash�flow�after�shareholder�

returns�to�between�¥270�billion�and�¥470�billion.

Mitsui’s Earning Power from the

Perspective of Core Operating

Cash Flow

We�position�core�operating�cash�flow�as�our�most�

important�indicator.�Core�operating�cash�flow�is�

the�source�of�funds�for�both�our�growth�strategy�

and�the�returns�we�provide�to�shareholders.

� From�2005�on,�resources�and�energy�prices�

surged,�leading�to�significant�growth�in�Mitsui’s�

core�operating�cash�flow� Chart 3 .�After�the�global�

recession�triggered�by�the�Lehman�Shock,�we�

were�able�to�secure�around�¥500�billion�of�cash�

generation�annually,�though�there�were�some�

fluctuations�caused�by�commodity�prices.

� Subsequently,�the�commodities�super-cycle�

ended.�The�fiscal�year�ended�March�31,�2016�saw�

crude�oil�prices�fall�below�$30�a�barrel,�but�even�

amid�these�circumstances,�which�appear�extreme�

when�we�look�back�now,�we�were�still�able�to�

maintain�cash�flow�of�¥470�billion.�To�us,�this�

verified�the�resilient�baseline�cash�flow�that�our�

asset�portfolio�could�produce,�and�we�used�this�in�

calculations�when�establishing�our�minimum�

dividend�policy.�Meanwhile,�we�have�been�getting�

positive�results�from�efforts�to�strengthen�our�

earnings�foundation�in�non-resource�areas.�

Through�a�combination�of�further�increasing�the�

cost�competitiveness�of�our�resource-related�

portfolio,�we�have�been�able�to�maintain�a�bal-

anced�earnings�structure�even�when�commodity�

prices�are�below�historic�trends.

� In�the�fiscal�year�ended�March�31,�2018,�we�

achieved�a�record�high�for�core�operating�cash�

flow,�partly�as�a�result�of�the�rise�in�coal�prices�as�

well�as�the�cash�provided�by�dividends�received�

from�the�past�earnings�of�equity-method�affiliates.�

Even�if�we�exclude�one-off�factors,�we�think�we�

are�on�track�to�maintain�core�operating�cash�flow�

in�the�range�of�¥550�billion�to�¥600�billion�per�

year�throughout�the�current�medium-term�man-

agement�plan.

Liquidity and Financial Leverage

Our�priority�in�funding�is�to�maintain�liquidity.�By�

obtaining�stable�medium-�to�long-term�funds,�our�

aim�is�to�avoid�concentrating�debt�maturity�and�to�


CFO�Message

minimize�refinancing�risk.�Under�this�strategy,�we�

aim�to�keep�enough�cash�in�hand�to�cover�around�

two�years�of�repayments.�As�in�the�financial�crisis,�

when�market�liquidity�dries�up,�or�if�for�some�

reason�we�are�not�able�to�access�the�market,�we�

aim�to�hold�ample�liquidity�on�our�balance�sheet.�

� Long-term�debt�repayment�per�year�is�a�little�

under�¥500�billion,�which�is�within�our�current�

core�operating�cash�flow�capacity.�From�the��

perspective�of�liquidity�we�believe�that�if�we�can�

further�lift�the�level�of�core�operating�cash�flow��

or�enable�even�longer�term�stable�fund�procure-

ment,�our�financial�base�will�become�even�more�

stable,�giving�us�increased�capacity�to�borrow.�

Conversely,�if�core�operating�cash�flow�decreases,�

or�if�funding�procurement�becomes�shorter�term,�

this�will�put�pressure�on�our�financial�base�and�

decrease�our�capacity�to�borrow.

� Net�DER�temporarily�increased�in�the�fiscal��

year�ended�March�31,�2016,�but�since�then�it�has��

continued�to�improve,�aided�by�hybrid�loans�

among�other�things� Chart 4 .�Although�we�have��

not�set�a�specific�target�level�for�net�DER,�by��

maintaining�positive�free�cash�flow�after�returns��

to�shareholders�within�the�current�cash�flow�

allocation�framework,�we�expect�to�see�a�steady�

improvement.�Although�net�DER�is�an�important�

leverage�indicator,�it�does�not�reflect�changes�in�

our�asset�structure.�Concomitant�with�the�shift�in�

business�composition�from�trading�to�investment,�

our�investment�assets�and�fixed�assets�have�been�

increasing.�When�you�have�an�increase�in�business�

investments�or�fixed�assets�that�are�relatively�high�

risk�or�take�longer�to�generate�returns,�leverage�

needs�to�be�reduced,�and�we�have�in�fact�delever-

aged�significantly�compared�to�historic�levels.�

Shareholders’ Equity and Risk

Management

When�we�compare�our�non-current�assets�with�

relatively�high�risk�and�the�equity�that�ultimately�

absorbs�this�risk,�we�see�that�there�has�continued�

to�be�gradual�improvements� Chart 5 .�This�gap�is�

mainly�funded�by�interest-bearing�debt,�and�if�this�

expands,�it�reduces�financial�stability.�Within�the�

current�cash�flow�allocation�framework,�our�aim��

is�to�gradually�improve�this�indicator�while��

balancing�the�need�for�growth�investment.�

� Also,�as�well�as�the�risk�amount�carried�by�assets�

on�the�balance�sheet,�we�assess�and�periodically�

monitor�the�amount�of�off-balance�sheet�risk�such�

as�market�risk�and�guarantees�to�a�set�standard.

� Our�risk�exposure�is�being�held�within�a�range�

Chart 4 Net Debt to Equity Ratio*

�Net�debt　 �Shareholders’�equity�(Attributable�to�owners�of�the�parent)　 �Net�DER�(right�scale)

*�Adjusted�net�DER�by�including�50%�of�subordinated�syndicated�loan�(¥550�billion)�in�capital

13 14 15 16 17 18 19(forecast)

20(forecast)

¥ billion Times

0

1,000

2,000

3,000

4,000

5,000

0

0.2

0.4

0.6

0.8

1.0

As of March 31


of�about�60%�of�our�shareholders’�equity� Chart 6 ,�

and�we�periodically�stress�test�our�risk�assets�for�

various�scenarios,�verifying�the�impact�on�the�risk�

asset�to�shareholders’�equity�ratio.

� For�all�these�indicators�we�focus�on�when�

considering�financial�strategy,�our�policy�is�to�

achieve�gradual�improvements�toward�the�final�

year�of�our�medium-term�management�plan�by�

following�our�cash�flow�allocation�framework��

and�maintaining�positive�free�cash�flow�after�

returns�to�shareholders.�While�keeping�a�close�

watch�on�the�business�environment,�we�aim�to�

maintain�and�improve�a�stable�financial�base,�

allocating�cash�flow�to�achieve�an�appropriate�

balance�between�growth�investment�and�returns�

to�shareholders.�

September�2018

Chart 6 Risk Assets / Shareholders’ Equity

Chart 5 Non-Current Assets / Shareholders’ Equity

�Risk�assets　 �Shareholders’�equity�(Attributable�to�owners�of�the�parent)　 �Risk�assets/Shareholders’�equity�(right�scale)

�Non-current�assets　 �Shareholders’�equity�(Attributable�to�owners�of�the�parent)　 �Non-current�assets/Shareholders’�equity�(right�scale)

13 14 15 16 17 18 19(forecast)

20(forecast)

0

1,000

2,000

3,000

4,000

5,000

0

15

30

45

60

75

¥ billion %

As of March 31

13 14 15 16 17 18 19(forecast)

20(forecast)

0

2,000

4,000

6,000

8,000

10,000

0

0.4

0.8

1.2

1.6

2.0

¥ billion Times

As of March 31


Medium-term Management Plan

Driving�Value�Creation

Quantitative

targets

Key initiatives

Mitsui’s focus

External

environment

¥440.0bn

（Year�to�March�31,�2020）

¥418.5bn

（Year�ended�March�31,�2018）

¥630.0bn


¥666.5bn


10%


10.9%


Profit�for�the�year*1 Core�operating�cash�flow*2 ROE

*1.�Profit�for�the�year�attributable�to�owners�of�the�parent


1 Build a robust profit base and thoroughly strengthen existing businesses

2 Establish selected new growth areas

3 Cash flow focused management; Strengthen financial base

P.036–041�CFO�Message

4 Enhance Governance, Personnel, and Innovation functions

• Establish a profit base resilient to external changes and risks

• Dynamic allocation of resources

• Strengthening our management foundation

• Following the end of the global resources super-cycle, a worldwide shift

away from an overreliance on volume expansion to a focus on the pursuit

of growth in quality

• Continued changes at a rapid pace, with shifts such as the move away

from a system of global rules led by the U.S. and Europe toward a world

in which each region considers what is optimal for them

20192018 2020

Progress�of�Medium-term�Management�Plan


FY2019 action plans

•��Further�strengthen�profit�base�in�core�areas�through�steady�progress�of�the�initiatives�described�below

•��Continue�efforts�to�decrease�loss-making�companies�and�grow�revenue�of�existing�businesses

•��Accelerate�initiatives�in�four�growth�areas�and�foster�the�next�revenue�pillars

440.0

420.0418.5

306.2240.0

240.0

90.0

50.0

60.0

85.0

89.6

34.2 ‒6.2

‒5.3

40.0

55.0

Years ended /

ending March 31

2018

（Results）


2019

（Plan）

2020

（Plan）

Non-resources

117.6

Non-resources

180.0

Non-resources

200.0

�Resources�&�Energy　 �Machinery�&�Infrastructure　 �Chemicals　 �Other�areas　 �All�others�/�Adjustments�and�eliminations

Profit for the year*1 (for each segment)

•� �Targeting�steady�profit�growth�in�non-resource�areas�through�

improvement�of�our�base�profit�

•� �Forecasting�profit�decline�in�Resources�&�Energy�in��

FY�Mar/2019�due�to�absence�of�valuation�gain�for�Valepar�

recorded�in�FY�Mar/2018

（¥�billion）（¥�billion）

630.0

570.0

666.5

416.1

158.8

17.0

380.0

400.0

105.0

80.0

45.0

85.0

50.2

24.4

55.0

40.0

Non-resources

233.4Non-resources

180.0

Non-resources

230.0

10.0

Years ended /

ending March 31

2018

（Results）

2019

（Plan）

2020

（Plan）


Core operating cash flow*2 (for each segment)

•� �Temporary�decline�in�FY�Mar/2019�mainly�due�to�a�concentra-

tion�of�large�dividend�payments�from�equity-method�affiliates,�

including�early�payments,�recorded�in�FY�Mar/2018

•��Steady�progress�from�FY�Mar/2018�in�strengthening�cash�flow�

generation�due�to�increase�in�base�profit�

*1.�Profit�for�the�year�attributable�to�owners�of�the�parent


FY2019 business plan

��Enhance�profit�base�at�existing�Australian�operations

��Improve�operations�at�Caserones�in�Chile

��Steadily�progress�toward�a�final�investment�decision�concerning�LNG�project�in�Mozambique

��Successfully�launch�Kaikias�in�U.S.�and�Tempa�Rossa�in�Italy

��Integrate�Australia-based�AWE�Limited�into�the�Group

��Launch�new�power�generation�projects�(Safi�in�Morocco,�Salalah-2�in�Oman)

��Accelerate�initiatives�in�next-generation�power�(Forefront�and�other�distributed�power,�

services�businesses)

��Pursue�mobility�service�initiatives�(lease,�rental,�and�sharing�businesses)

��Expand�Intercontinental�Terminals�Company�LLC�in�the�U.S.

��Participate�in�European�coating�materials�business

��Pursue�Novus�International�Inc.�growth�strategy�in�the�U.S.�(pursue�plans�to�expand��

methionine�manufacturing�capacity,�etc.)

Mineral & Metal

Resources

Energy

Machinery &

Infrastructure

Chemicals

2019 20202018


Progress�of�Medium-term�Management�Plan

Key initiatives and results of first year of medium-term management plan

Results of first year of medium-term management plan

In�FY�Mar/2018,�the�first�year�of�the�medium-term�management�plan,�we�built�a�robust�profit�base�and�thoroughly�strength-

ened�existing�businesses�and�grew�non-resource�area�profit�to�¥170.0�billion�level,�excluding�valuation�gains/losses.

Segment Specific�achievements

Mineral &

Metal

Resources

� �Ramping�up�of�Moatize/Nacala,�entered�into�project�finance�in�Mozambique

� �Acquired�additional�equity�in�Collahuasi�copper�mine�in�Chile

Energy � �Start�of�Kipper�contribution�in�Australia

� �Tender�offer�for�AWE�Limited�in�Australia

Machinery &

Infrastructure

� �Improved�asset�quality�through�IPP�asset�recycling

� Commencement�of�2�FPSO�charter�contracts

� �Additional�investment�in�Penske�Truck�Leasing�Co.,�L.P.�in�the�U.S.�

Chemicals � �Stable�operations�of�methanol�business

� �Strengthened�trading�(Mitsui�&�Co.�Plastics�Ltd.,�European�sulphur�&�sulfuric�acid�business,�etc.)

Iron & Steel

Products

� �Promoted�business�reform�(made�Nippon�Steel�&�Sumikin�Bussan�Corporation�an�equity-method�

affiliate,�sold�Champions�Cinco�Pipe�&�Supply�LLC�in�the�U.S.,�etc.）

� �Expansion�of�Gestamp�Automoción�S.A.�business�in�Spain

Lifestyle � �Decision�to�withdraw�from�Multigrain�Trading�AG�in�Brazil

� �Panasonic�Healthcare�Holdings�Co.,�Ltd.�(currently�PHC�Holdings�Corporation)�contributed�to�profit

� �Acquired�Bigi�Holdings�Co.,�Ltd.

Innovation &

Corporate

Development

� �Strengthened�profit�base�of�CIM�Group,�LLC�in�the�U.S.�by�increasing�assets�under�management

� �Expanded�consumer�goods�logistics�business�(Mitsui�&�Co.�Global�Logistics,�Ltd.)

Initiative 1 Build a robust profit base and thoroughly strengthen existing businesses

2019 20202018

The�three�core�areas�of�our�medium-term�management�plan�are�Resources�&�Energy,�Machinery�&�Infrastructure,�

and�Chemicals.�We�aim�to�generate�90%�of�our�entire�core�operating�cash�flow�from�these�three�areas.�We�will�

continue�to�add�assets�through�bolt-on�acquisitions�in�these�areas�of�strength,�thereby�enhancing�our�strengths.

Resources & Energy Machinery & Infrastructure Chemicals

•��Iron�Ore

•��Oil�&�Gas

•��Power�generation

•��Marine�energy

•��Gas�distribution

•��Automotive

•��Shipping

•��Railroads

•��Feed�additives/Agricultural�chemicals

•�Functional�materials

•�Tank�terminals

•��Chemical�products�manufacture�and�

trading

� In�addition,�we�will�thoroughly�strengthen�existing�businesses�and�improve�the�value�through�the�following�

initiatives.

• Realize latent value (raise value through operational improvement, business revitalization, and industry reorganization)

• Pursue business entry and exit coordinated with business cycle

• Reinforce trading by upgrading our selling power and value add


Key initiatives and results of first year of medium-term management plan


In�FY�Mar/2018,�we�accelerated�initiatives�to�establish�four�new�growth�areas,�mainly�in�Mobility�and�Healthcare.

Specific�achievements

Mobility ��Commercial�vehicle�electrification�initiatives�starting�in�Europe�(investment�in�EV�bus�business,�

electric�vehicle�battery�business)

��Expanded�railway-related�business�(expanded�rail�network�in�U.K.�passenger�rail�business,��

started�Taiwan�train�station�business)

��Initiatives�in�operating�lease�and�rental�car�business�in�Chile

Healthcare ��Expanded�hospital�infrastructure�business�in�Southeast�Asia�(additional�investment�in��

Columbia�Asia�Group)

��Took�initiatives�to�address�new�drug�needs�in�Russia�(investment�in�JSC�R-Pharm)

��Expanded�healthcare�staffing�business�(acquisition�of�Accountable�in�U.S.)

Nutrition &

Agriculture

��Strengthened�network�and�Africa�regional�strategy�(ETC�Group�Limited�investment�agreement)

��Reinforced�food�science�area�(SODA�AROMATIC�Co.,�Ltd.�tender�offer)

Retail &

Services

��Expanded�assets�under�management�(¥1.4�trillion�to�¥1.9�trillion）

��Acquired�planning/marketing�platform�in�fashion�and�retail�business


Specific�achievements

Strengthen

governance

��Strengthened�the�effectiveness�of�the�Board�of�Directors

� •�Increased�diversity�and�improved�skill�set�balance�of�Board�members

� •��Created�more�opportunities�for�discussion�on�Mitsui’s�long-term�direction,�including�its�corporate�strategies�

and�medium-term�management�plan

��Established�Sustainability�Committee,�and�promoted�management�with�greater�emphasis�on�the��

sustainability�of�both�society�and�Mitsui

Strengthen the

individual

��Shifted�corporate�staff�to�business�frontline

��Introduced�staggered�working�hours�at�an�individual�level

��Launched�in-house�entrepreneur�system,�currently�preparing�to�commercialize�business�plans

Strengthen

innovation

functions

��Appointed�CDO�and�established�Digital�Transformation�(DT)�team

��Accelerated�initiatives�of�DT,�focusing�on�three�areas:�reducing�costs�in�existing�businesses,��

increasing�sales�in�existing�businesses,�and�developing�new�business

��Please�see�“Promoting�the�Digital�Transformation�Strategy”�on�pages�048�and�049.

�P.046–047

Initiative 2 Establish selected new growth areas

Initiative 4 Enhance Governance, Personnel, and Innovation functions

Based�on�the�medium-term�outlook�for�the�business�environment,�we�have�selected�four�growth�areas�in�which�

we�can�excel�and�allocate�business�resources�to�these�areas�dynamically.

Mobility Healthcare Nutrition & Agriculture Retail & Services

Multifaceted�approach�to�

Materials�and�Mobility�&�

Transportation�services�based�

on�changing�social�needs�in�

the�environmental�society

Build�healthcare�ecosystem�

around�medical�services�

businesses

Raise�productivity,��

provide�stable�supplies��

in�agriculture/livestock/

fisheries,�enhance�added�

value�of�foods

Foster�next�generation��

digital/logistics/financial�

functions�to�meet��

consumer�needs

2019 20202018

2019 20202018

The expanding middle class of Asia and growing North American economy are core targets

Establish Mitsui’s next profit pillars


Mitsui has selected Mobility, Healthcare, Nutrition & Agriculture, and Retail & Services as four areas

in which we can leverage our strengths. To establish these areas as its next profit pillars, Mitsui is con-

tinuing to push ahead with aggressive initiatives for the strategies formulated under its medium-term

management plan.

Results�of�Initiatives��

Case�1:�Establishing�Selected�New�Growth�Areas

Mobility

Healthcare

Basic Strategies

Respond to innovation in transportation

services

� •� �Provide�comprehensive�services�in��

passenger�and�cargo�transportation

Respond to the “sharing economy” sector

� •� �From�“owning”�to�“use,”�expand�the�service

Create business opportunities that support

technological innovations

� •� �Engage�in�new�businesses�in�the��

automotive�industry

Contribute to the creation of

next-generation cars

� •� �Expand�the�automotive�components��

and�materials�business

1

2

3

4

Basic Strategies

Strengthen existing businesses

� •� �Promote�initiatives�aimed�at�improving�profitability

Gain operatorship

� •� �Hospitals�and�hospital�ancillary�businesses

� •� �Manufacture�and�sale�of�pharmaceuticals

� •� �Healthcare�staffing�businesses

Strengthen collaboration between assets

� •� �Maximize�value�of�healthcare�ecosystems

� •� �Formulate�and�execute�business�strategies��

in�new�domains

1

2

3

Expansion of Passenger Rail Business in the U.K.

Mitsui�was�collectively�selected�as�

the�winning�bidder�for�the�West�

Midlands�Franchise,�jointly�with�

East�Japan�Railway�Company�and�

Abellio�Transport�Group�Limited.�

Through�the�West�Midlands�

Franchise,�we�will�provide�safe�and�

quality�services�cultivated�by�the�rail�business�in�Japan.

Acceleration of Electric Vehicle Business

Expansion in Europe

Mitsui�has�invested�in�Foresee�

Power,�a�French�battery�system�

manufacturer,�and�CaetanoBus,�

S.A.,�a�Portuguese�electric�bus��

manufacturer.�By�forming�organic�

collaborations�between�these�

companies,�Mitsui�will�move�

forward�with�the�expansion�of��

the�electric�vehicle�business.

Acquisition of Healthcare Staffing Company

in the U.S.

Mitsui�acquired�100%�of�the�shares�

in�Accountable�Healthcare�Holding�

Corporation,�the�leading�provider��

of�nurse�staffing�services�and�other�

healthcare�providers�in�the�U.S.�

Mitsui�intends�to�expand�the�scale�

of�human�capital�businesses,�

which�include�the�supply�of�healthcare�providers.

Acquisition of an Additional Equity Stake in

Columbia Asia Group

Mitsui�carried�out�an�additional�

investment�in�Columbia�Asia�

Group,�the�largest�international�

hospital�group�in�Asia.�By�further�

strengthening�the�partnership�

with�the�founding�members,�the�

Baty�Family,�Mitsui�is�committed�to�

solving�the�medical�supply-demand�gap�in�Asian�countries.



Retail & Services

Basic Strategies

Answer the need for increased food

production

� •� �Expand�grain�trading

� •� �Further�develop�global�logistics

� •� �Expand�agricultural�inputs�business��

and�sulphur�business

� •� �Enhance�the�animal�nutrition�business

Answer the need for foods with high

added value

� •� �Expand�business�of�value�added�products��

that�promote�health

� •� �Accelerate�the�development�of�the�food��

science�business

1

2

Basic Strategies

Strengthen and develop existing assets

� •� �Strengthen�collaboration�between��

business�assets

� •� �Strengthen�collaboration�with�the��

Seven�&�i�Group

� •� �Provide�solutions�through�digital�transformation

� •� �Develop�and�enhance�the�media�commerce�business

Adapt to change

� •� ��Respond�to�expansion�in�the�prepared��

foods�market

� •� �Further�enhance�chilled�&�frozen�distribution

� •� �Expand�contact�points�with�consumers

� •� �Develop�and�deliver�food�products

Provide attractive investment management

services

� •� �Increase�balance�of�assets�under�management

� •� �Enhance�sales�capabilities�aimed�at�domestic�investors

1

2

3

Reinforcement of the Food Science Domain

Mitsui�completed�the�delisting�of�

SODA�AROMATIC�Co.,�Ltd.�through�a�

tender�offer�for�its�common�shares.�

While�drawing�on�its�overseas��

network,�Mitsui�will�further�acceler-

ate�the�expansion�both�in�Japan��

and�overseas�by�leveraging�Soda�

Aromatic’s�expertise�related�to��

manufacturing,�quality�control,�product�application��

development,�and�other�matters.

Agreement to Invest in ETC Group

Mitsui�agreed�to�invest�in�ETC�

Group�Limited,�which�engages�in�

the�business�involving�agricultural�

products,�agricultural�supplies,�and�

food�manufacturing�and�sales�in�East�

Africa�to�expand�its�networks�(com-

pleted�investment�in�May�2018).

Asset Management Business

We�were�able�to�increase�assets�

under�management�to�¥1.9�trillion�

over�the�past�year,�responding�to�

investors’�diverse�needs�with�asset�

management�business�in�Japan�

and�abroad.

Acquisition of Bigi Holdings

Mitsui�has�gained�planning�and�

sales�platforms�of�fashion�and�

retail�businesses�with�the�acquisi-

tion�of�Bigi�Holdings�Co.,�Ltd.�This�

will�bring�us�close�to�consumers�

and�enable�us�to�strengthen�our�

marketing�and�sales�capabilities.


Digital transformation is a strategy for realizing improved profits through

the utilization of digital power to improve the operational expertise and

technologies at business frontlines (Operational Technology = OT). To this

end, we will quantify and digitalize various business information and data

at business frontlines and around the globe and use digital power such

as AI to categorize, analyze, and control this data. By doing so, we aim to

leverage this data in our businesses and society. We are pursuing the

digital transformation to reduce costs and increase sales by enhancing

and optimizing our business operations. We will also take steps to improve

the quality of our existing businesses while moving forward with the

creation of new business models.

We�employ�ICT�at�our�diverse�project�sites�around�the�world,�as�we�aim�to�further�improve�our�business�value�by�

increasing�sales�and�improving�the�efficiency�of�existing�businesses.

Business Evolution through Strategic Alliances Solution

In�March�2016,�Mitsui�invested�in�the�U.S.-based�OSIsoft,�LLC,�thereby�entering�into�a�

memorandum�of�understanding�to�explore�business�opportunities.�This�strategic��

alliance�was�formed�in�order�to�transform�the�conventional�business�model�of�a�general�

trading�company�before�the�full-scale�onset�of�the�IoT�era.�Through�this�alliance,�we�will�

utilize�OSIsoft’s�core�product,�PI�System,�to�improve�the�operational�efficiencies�of�the�

Group�businesses�and�pursue�cost�reductions.�Since�August�2017,�we�have�been�conducting�a�demonstration�experi-

ment�that�uses�PI�System�to�remotely�monitor�the�operating�conditions�of�our�owned�power�plant�in�Mexico�in�real�

time.�Going�forward,�we�intend�to�make�use�of�PI�System�at�our�factories�and�facilities�around�the�world.

Active Incorporation of AI Technologies Solution

Mitsui�has�invested�in�the�U.K.-based�Sky�Futures,�a�company�that�leverages�drone-gathered�data�and�AI�to��

resolve�issues�related�to�inspection�and�examination�and�provide�solutions�for�enhancing�business�profitability.��

For�example,�through�the�introduction�of�drones,�Sky�Futures�can�help�eliminate�the�need�for�periodic��

shutdowns�at�factories,�in�addition�to�confirming�the�safety�of�factory�employees.�This�in�turn��

helps�to�significantly�reduce�the�cost�of�factory�inspections,�including�opportunity�costs��

associated�with�the�stoppage�of�factory�operations.

� Also,�we�have�been�deepening�our�collaboration�with�our�key�business�partner�

Komatsu�Ltd.�Together�with�LANDLOG�Ltd.,�an�IoT�specialist�company�in�the��

construction�industry,�we�have�been�moving�forward�with�efforts�to�introduce�

digital�solutions�to�improve�industrial�productivity.�As�part�of�these�efforts,�

we�have�been�promoting�a�fuel�supply�service�business�geared�toward�

construction�sites.

Strategy

1 Improving the Quality of Existing Businesses


Case�2:�Promoting�the�Digital�Transformation�Strategy

Digital Tran sformation

Cut�costs

S:�Solution　T:�Transformation

Increased�salesBenefits

S1Greater

efficiency

S1’Companywide

development

S2Greater

added value

TChallenge of

new business

opportunities

Bu

sine

ss Mo

de

lN

ew

Ex

isting


Within�the�Group,�we�have�companies�that�develop�digital�solutions�and�companies�that�provide�data�analysis�surveys.�

At�the�same�time,�we�have�formed�strategic�alliances�with�a�diverse�range�of�business�partners.�By�combining�and�

leveraging�the�expertise�of�the�Companies�and�business�partners,�we�will�work�to�create�new�business�models�while�

spurring�innovation�in�our�own�businesses�to�respond�to�the�changing�times.

Partnership with Highly Advanced AI Companies Transformation

Mitsui�regards�securing�world-class�AI�engineers�as�a�priority�matter�and�partnering�with�a�company�with�highly�

advanced�AI�technologies�as�an�integral�part�of�its�strategy�to�enhance�its�competitiveness�through�digitalization.��

To�this�end,�in�December�2017�we�invested�in�Preferred�Networks,�Inc.,�which�develops�and�provides�AI�technologies.�

In�addition�to�supporting�the�growth�of�Preferred�Networks,�we�will�use�its�deep�learning�technology�to�solve�issues�

affecting�our�business�partners,�customers,�and�the�Group’s�global�business�assets�in�a�wide�range�of�industries.�

Furthermore,�we�aim�to�create�businesses�under�a�recurring�business�model�with�the�use�of�next-generation��

AI�technologies.�Through�our�partnership�with�Preferred�Networks,�we�will�gain�practical�knowledge�about��

cutting-edge�AI�technologies�and�undertake�human�resource�development�initiatives�to�train�people�to�utilize��

AI�and�formulate�businesses.

Establishment of a Medical Imaging AI Platform Business Transformation

In�April�2018,�Mitsui�invested�in�NOBORI�Ltd.,�a�company�newly�established�by�TechMatrix�Corporation,�which��

transferred�its�medical�systems�business.�NOBORI�provides�cloud�service�of�picture�archiving�and�communication��

systems�and�already�has�over�800�contracted�medical�facilities�and�has�accumulated�a�massive�resource�of�imaging�data�

representing�120�million�medical�examinations�of�a�total�of�22�million�patients.�While�building�a�data�platform�based�

on�NOBORI’s�accumulated�imaging�data,�we�will�provide�AI-based�interpretation�and�diagnosis�support,�which��

will�contribute�to�more�advanced�medical�care�and�promote�collaboration�with�medical�institutions�to�develop�and�

introduce�services�for�individual�patients.

Launch of Dynamic Pricing Business

Transformation

In�June�2018,�Mitsui�and�Yahoo�Japan�Corporation�established�

Dynamic�Plus�Co.,�Ltd.,�a�joint�venture�that�provides�dynamic�

pricing�services,�which�set�flexible�prices�for�services�based��

on�current�market�demand.�Dynamic�Plus�has�accepted�

equity�investment�from�PIA�Corporation,�one�of�the�largest�

ticketing�agencies�in�Japan,�and�signed�an�alliance�to�develop�

a�dynamic�pricing�business.�Drawing�on�PIA’s�solid�track�

record�in�tickets�for�sporting�events,�we�will�expand�our�

dynamic�pricing�businesses�geared�toward�the�hotel,�parking,�

transportation,�and�other�as-a-service�industries.

Strategy

2 Creating New Business Models

Digital Tran sformationMITSUI�&�CO.,�LTD.��Integrated�Report�2018� 049


Case�3:�Main�Results�of�Our�Efforts�toward�Sustainability

Stable Supply of Resources & Materials

Of our five material issues (Materiality), we aim to realize the “Stable supply of resources & materials,” the

“Enhancement of local industrial bases & quality of life,” and the “Protection of the global environment”

through our business. This section introduces the main efforts we pursued to address these material

issues in the fiscal year ended March 31, 2018.

For more details on the results of our sustainability activities, please refer to Sustainability Report 2018.

November�2017

Participation in Floating Storage and Regasification

Unit Project in Pakistan

In�Pakistan,�demand�for�gas�is�growing�while�production�of�indigenous�gas�is�

declining.�Through�a�long-term�agreement�to�jointly�own�a�floating�storage�and�

regasification�unit�(FSRU),�we�provide�regasification�services�for�LNG�with�a�low�

environmental�impact.�The�demand�for�imported�LNG�in�Pakistan�is�expected�to�

grow�steadily�and�the�FSRU�project�delivers�a�key�energy�infrastructure�project�of�

high�national�importance.

February�2018

Acquisition of Additional Equity in the

Collahuasi Copper Mine in Chile

Mitsui�has�owned�concessions�in�the�Collahuasi�Copper�Mine�since�1996.�With�

its�high-grade�and�cost�competitiveness,�the�mine�is�an�excellent�asset�with�the�

potential�to�further�enhancement�of�its�business�value�through�future�produc-

tion�expansions.�World�demand�is�expected�to�increase�steadily�over�the�

medium-�to�long-term�future,�in�line�with�infrastructure�investment�in�emerging�

countries.�Through�the�acquisition�of�additional�equity�in�the�Collahuasi�Copper�

Mine,�we�contribute�to�the�stable�supply�of�resources�going�forward.

FSRU�BW Integrity

Collahuasi�Copper�Mine

Enhancement of Local Industrial Bases & Quality of Life

April�2017

Execution of Long-term Power Purchase Agreement for

New Solar Photovoltaic Project in Jordan

Facing�an�increase�in�electricity�demand�due�to�steady�economic�growth,�the�

Government�of�Jordan�has�decided�to�promote�renewable�energy�to�enhance�

generation�capacity.�We�will�continue�to�contribute�to�the�stable�supply�of��

growing�electricity�demand�and�clean�energy�development�in�Jordan�by��

participating�in�this�project.

Solar�panels�scheduled�to�be�purchased

©JA�Solar�Holdings


April�2017

Participation in Russian Pharmaceutical Company JSC R-Pharm

In�pharmaceutical�areas,�we�have�focused�in�particular�on�the�alleviation�of�

qualitative�and�quantitative�gaps�in�emerging�countries�through�the�expansion�of�

business�operations�centering�on�support�for�new�drug�development,�manufac-

turing,�and�sales.�Through�the�investment�in�JSC�R-Pharm,�we�will�contribute�to�

the�development�of�the�Russian�and�CIS�pharmaceutical�market,�where�demand�

for�pharmaceuticals�is�shifting�from�low-cost�generics�to�new�drugs�with�high�

added�value�following�the�rise�in�per�capita�income.JSC�R-Pharm

April�2017

Participation in Land-based Trout Farming Business in Japan

Global�population�growth�and�the�improvement�of�living�standards�are�reflected�

in�the�continuing�rise�in�demand�for�marine�products.�As�a�result,�there�is�an�

expanding�need�for�products�from�fish�farming�systems.�Recognizing�that�areas�

suitable�for�sea�aquaculture�are�limited,�Mitsui�aims�to�develop�land-based�

aquaculture�with�an�extremely�low�environmental�impact�in�order�to�meet�the�

farming�industry’s�growing�demand�for�marine�products�in�the�future.

October�2017

Participation in The Mobility House for Commercialization of

German-based Energy Management Services with Electric

Vehicles (EVs)

Due�to�the�spread�throughout�the�market�of�electric�vehicles,�the�electric�power�

industry�is�faced�with�an�increased�burden�on�power�grid�systems.�To�address�

this�issue,�Mitsui�has�invested�in�The�Mobility�House�AG,�which�is�engaged�in��

the�sale�of�charging�systems�for�electric�vehicles�and�in�the�development�of�

stationary�energy�storage�systems�built�with�secondhand�electric�vehicle��

batteries.�In�addition,�The�Mobility�House�conducts�demonstration�projects��

for�services�that�connect�parked�electric�vehicles�to�the�power�grid�to�adjust��

the�supply�and�demand�of�electricity.�Through�the�investment�in�The�Mobility�

House,�we�will�take�on�the�challenge�of�creating�an�innovative�business�model�

in�which�electric�vehicle�owners�can�obtain�supplementary�income�by�using�

their�on-board�battery�to�help�stabilize�electric�power�grids.

December�2017

Strategic Alliance with Portuguese Electric Bus Manufacturer

As�a�measure�against�atmospheric�pollution�and�to�protect�the�environment,�the�

bus�market�is�an�area�where�electrification�is�anticipated�to�become�widespread�

as�large�cities�in�Europe�launch�a�policy�to�actively�promote�the�electrification�of�

buses.�Under�these�circumstances,�Mitsui�has�formed�a�strategic�alliance�with�

CaetanoBus,�S.A.�Through�this�alliance,�Mitsui�promotes�the�sales�expansion�of�

electric�buses�produced�by�CaetanoBus�in�Europe,�Asia,�and�worldwide,�and�

contributes�to�the�realization�of�an�environmentally�friendly�society.

Protection of the Global Environment

Land-based�trout�farming�system�of��

FRD�Japan�Co.

The�CaetanoBus-developed�electric�bus��

“e.�City�Gold”�in�operation�in�Portugal

Large�energy�storage�system�operated�by��

The�Mobility�House


Our BusinessCHAPTER 3


Our BusinessCHAPTER 3

054 Results by Operating Segment

056 Review of Segments

� 056� Iron�&�Steel�Products�Segment

� 058� Mineral�&�Metal�Resources�Segment

� 060� Machinery�&�Infrastructure�Segment

� 062� Chemicals�Segment

� 064� Energy�Segment

� 066� Lifestyle�Segment

� 068� �Innovation�&�Corporate�Development�Segment

070 The Structure That Supports Mitsui


Iron &

Steel Products

Mineral &

Metal Resources

Machinery &

InfrastructureChemicals Energy Lifestyle


Development

Others /

Adjustments and

Eliminations

Company�Total¥�billion

Business�Unit Iron�&�Steel�Products��

Business�Unit

Mineral�&�Metal�Resources�

Business�Unit

Infrastructure�Projects��

Business�Unit

Integrated�Transportation�

Systems�Business�Unit�I


Systems�Business�Unit�II

Basic�Materials�Business�Unit

Performance�Materials��

Business�Unit

Nutrition�&�Agriculture��

Business�Unit

Energy�Business�Unit�I

Energy�Business�Unit�II

Food�Business�Unit

Food�&�Retail�Management�

Business�Unit

Healthcare�&�Service��

Business�Unit

Consumer�Business�Unit

IT�&�Communication��

Business�Unit

Corporate�Development�

Business�Unit

Core�Operating�Cash�Flow 14.2 240.8 158.8 50.2 175.3 7.1 3.1 17.0 666.5

Net�Investment�Cash�Flow (22.7) (2.5) (38.1) (35.4) (62.6) (69.1) (3.3) (22.8) (256.6)

Investment�Cash�Flow�

(IN)15.2 67.6 128.9 0.6 34.6 38.4 15.2 4.2 304.8


(OUT)(37.9) (70.1) (167.0) (36.0) (97.3) (107.5) (18.6) (27.1) (561.4)

Free�Cash�Flow*1 (8.5) 238.3 120.8 14.7 112.7 (62.0) (0.2) (5.8) 409.9

Gross�Profit 41.9 206.8 121.9 136.6 96.8 139.5 45.1 2.1 790.7

Equity�in�Earnings�(Loss) 13.3 61.8 96.5 11.3 24.5 22.8 5.0 (0.5) 234.9

Dividend�Income 2.5 16.4 3.4 2.3 51.9 4.3 2.7 1.3 84.8

Selling,�General�and�

Administrative�Expenses(32.1) (44.4) (121.5) (96.6) (42.1) (153.0) (50.8) (31.1) (571.7)

Other (0.9) 17.0 (10.7) (19.4) (82.5) (39.9) (6.6) 22.9 (120.2)

Profit�(Loss)�for�the�Year��

Attributable�to�Owners��

of�the�Parent

24.7 257.6 89.6 34.2 48.6 (26.3) (4.6) (5.3) 418.5

Assets 654.7 2,092.9 2,255.7 1,186.3 1,917.7 1,901.8 622.7 674.9 11,306.7

Non-current�Assets 341.8 1,530.7 1,543.9 503.6 1,396.9 1,128.1 409.6 225.9 7,080.5

Property,�Plant�and�

Equipment10.9 381.7 199.4 201.5 628.4 170.0 36.4 101.6 1,729.9

Investments�Accounted�

for�Using�the�Equity�

Method

217.8 431.7 880.2 117.4 254.3 452.9 151.4 (2.6) 2,503.0

Other�Investments 101.8 542.9 119.1 103.1 387.7 291.3 201.1 78.0 1,825.0

Other�Non-current�

Assets*211.3 174.4 345.2 81.6 126.5 213.9 20.7 48.9 1,022.6

Number�of�Employees�

(Non-consolidated)349 291 851 676 403 936 439 1,914 5,859


(Consolidated)1,873 599 15,613 5,107 803 11,195 3,575 3,539 42,304


Development

1%

Lifestyle

1%

Energy

27%

Chemicals

8%


24%

Mineral &

Metal Resources

37%


2%


Development

6%

Lifestyle

18%

Energy

12%

Chemicals 17%

Machinery &

Infrastructure

16%

Mineral &

Metal Resources

26%


5%


Development

2%

Lifestyle

10%

Energy

10%

Chemicals

5%


41%

Mineral &

Metal Resources

26%


6%

Results�by�Operating�Segment（Year�Ended�March�31,�2018,�IFRS）

Core�

Operating�

Cash�Flow

Gross�Profit

Equity�in�

Earnings�

(Loss)

Composition by Operating Segment

Ⓒ MODEC


Iron &

Steel Products

Mineral &

Metal Resources

Machinery &



Development

Others /

Adjustments and

Eliminations

Company�Total¥�billion

Business�Unit Iron�&�Steel�Products��

Business�Unit

Mineral�&�Metal�Resources�

Business�Unit

Infrastructure�Projects��

Business�Unit






Performance�Materials��

Business�Unit

Nutrition�&�Agriculture��

Business�Unit




Food�&�Retail�Management�

Business�Unit

Healthcare�&�Service��

Business�Unit


IT�&�Communication��

Business�Unit

Corporate�Development�

Business�Unit

Core�Operating�Cash�Flow 14.2 240.8 158.8 50.2 175.3 7.1 3.1 17.0 666.5

Net�Investment�Cash�Flow (22.7) (2.5) (38.1) (35.4) (62.6) (69.1) (3.3) (22.8) (256.6)


(IN)15.2 67.6 128.9 0.6 34.6 38.4 15.2 4.2 304.8


(OUT)(37.9) (70.1) (167.0) (36.0) (97.3) (107.5) (18.6) (27.1) (561.4)

Free�Cash�Flow*1 (8.5) 238.3 120.8 14.7 112.7 (62.0) (0.2) (5.8) 409.9

Gross�Profit 41.9 206.8 121.9 136.6 96.8 139.5 45.1 2.1 790.7

Equity�in�Earnings�(Loss) 13.3 61.8 96.5 11.3 24.5 22.8 5.0 (0.5) 234.9

Dividend�Income 2.5 16.4 3.4 2.3 51.9 4.3 2.7 1.3 84.8

Selling,�General�and�

Administrative�Expenses(32.1) (44.4) (121.5) (96.6) (42.1) (153.0) (50.8) (31.1) (571.7)

Other (0.9) 17.0 (10.7) (19.4) (82.5) (39.9) (6.6) 22.9 (120.2)

Profit�(Loss)�for�the�Year��

Attributable�to�Owners��

of�the�Parent

24.7 257.6 89.6 34.2 48.6 (26.3) (4.6) (5.3) 418.5

Assets 654.7 2,092.9 2,255.7 1,186.3 1,917.7 1,901.8 622.7 674.9 11,306.7

Non-current�Assets 341.8 1,530.7 1,543.9 503.6 1,396.9 1,128.1 409.6 225.9 7,080.5

Property,�Plant�and�

Equipment10.9 381.7 199.4 201.5 628.4 170.0 36.4 101.6 1,729.9

Investments�Accounted�

for�Using�the�Equity�

Method

217.8 431.7 880.2 117.4 254.3 452.9 151.4 (2.6) 2,503.0

Other�Investments 101.8 542.9 119.1 103.1 387.7 291.3 201.1 78.0 1,825.0

Other�Non-current�

Assets*211.3 174.4 345.2 81.6 126.5 213.9 20.7 48.9 1,022.6


(Non-consolidated)349 291 851 676 403 936 439 1,914 5,859


(Consolidated)1,873 599 15,613 5,107 803 11,195 3,575 3,539 42,304


Development

6%

Lifestyle

17%

Energy

20%

Chemicals 7%

Machinery &

Infrastructure

23%

Mineral &

Metal Resources

22%


5%


Development

6%

Lifestyle

18%

Energy

18%

Chemicals 11%

Machinery &

Infrastructure

21%

Mineral &

Metal Resources

20%


6%

Assets

Non-�

current�

Assets

Note:�The�horizontal�and�vertical�totals�may�not�match�as�a�result�of�differences�that�occurred�due�to�the�rounding�of�figures.

*1.��“Free�cash�flow”�is�calculated�from�core�operating�cash�flow�and�differs�from�free�cash�flow�calculated�using�conventional�accounting�methods.

*2.�“Other�non-current�assets”�includes�non-current�receivables,�investment�property,�intangible�assets,�and�deferred�tax�assets.

Note:��The�pie�chart�for�Profit�for�the�Year�is�not�

shown�as�some�segments�recorded�a�deficit.

Ⓒ Sakhalin�Energy


Iron�&�Steel�Products�Segment

Managing�Officer,

Chief�Operating�Officer��

of�Iron�&�Steel�Products�Business�Unit

Shinichi�Hori

Business Activities

To�respond�to�diverse�industrial�

needs,�we�procure,�supply,�sell,�and�

invest�in�processing�and�functional�

trading�businesses�of�iron�and�steel�

products,�both�in�Japan�and�in�various�

overseas�regions.

Mitsui’s Competitive Advantages

・��Comprehensive�strengths�that�

leverage�the�extensive�customer�

base�and�partnerships�possessed�by�

our�16�Headquarter�Business�Units�

in�Japan�and�overseas

・��Diversified�business�portfolio�with�

value�chains�around�the�world�that�

cover�everything�from�upstream�to�

downstream�operations

Iron & Steel Products Business Unit

Iron�&�steel�products�

business�/�Gestamp�

Automoción�S.A.�(Spain)

Review�of�Segments�(IFRS)

Business Environment

Business�

opportunities

•�Promotion�of�electric�vehicles�following�the�transition�to�a�low-carbon�society,�diversification�and�increased��

efficiency�of�energy�consumption,�and�the�trend�in�renewable�energy�use•�Trend�in�logistics�innovation�and�a�shift�toward�smart�factories�as�a�result�of�digital�transformation

Business��

(competitive)�risks

•� Industrial�reorganization�and�changes�to�distribution�channel�against�the�backdrop�of�steel�overproduction�in�China•� Impact�of�trade�friction�on�the�supply�and�demand�of�products�stemming�from�measures�by�the�U.S.�to�apply�

additional�tariffs

Basic Strategies

•�Create�businesses�through�synergies�between�steel�trading�business�and�business�investments•�Provide�high-value-added�services�including�component�manufacturing�and�repair�and�maintenance•�Facilitate�collaborations�between�existing�businesses,�assets�with�comprehensive�strengths,�and�business�partners;�further�pursue�new��

business�creation�centered�on�industrial�businesses

Individual Strategies & Progress

Area Our�Approach

Automotive •�We�are�providing�support�for�business�expansion�in�order�to�contribute�to�value�improvement�for�Gestamp�Automoción�

S.A.�(GA).�We�are�also�promoting�the�establishment�of�new�businesses�and�peripheral�trading�businesses�for�GA,�with�a�

focus�on�the�core�field�of�mobility.•�We�are�working�to�acquire�materials�and�components�businesses�in�response�to�structural�changes�in�the�industry�

brought�about�by�the�shift�to�electric�vehicles.

Infrastructure •�We�are�establishing�a�steel�supply�structure�through�the�electric�furnace�business�in�order�to�respond�to�the�global�

demand�for�infrastructure.•�We�are�developing�steel�processing�and�trading�businesses�on�a�local�basis�in�response�to�trends�relating�to�local��

production�for�local�consumption�of�construction�steel.

Energy •�We�are�improving�the�quality�of�our�portfolio�in�the�energy�domain�through�the�sale�of�Champions�Cinco�Pipe�&��

Supply�LLC.•�We�are�pursuing�highly�functional�trading�in�the�oil�and�gas�field�and�stepping�up�our�efforts�in�the�renewable�energy�

field�centered�on�GRI�Renewable�Industries,�S.L.�and�GEG�Holdings�Limited.

Steel�trading •�We�are�creating�steel�trading�businesses�that�leverage�the�respective�strengths�of�Mitsui�&�Co.�Steel�Ltd.,�MM�&�KENZAI�

Corporation,�and�Nippon�Steel�&�Sumikin�Bussan�Corporation.


Major Subsidiaries & Associated Companies

Company�Name BusinessesOwnership�

Interest�(%)

Annual�Earnings�(¥�billion)

16/3 17/3 18/3

Mitsui�&�Co.�Steel�Ltd. Sales,�export,�import�of�steel�products 100.0� 3.7 3.7 6.1

(Consolidated)�Gestamp�companies Manufacture�of�automotive�components Var. 1.4 0.6 3.9

Game�Changer�Holdings�Inc. Investment�in�steel�processing�company 100.0� 2.4 3.6 6.7

¥ billion

Years ended/ending March 31

181716

0

8

16

24

32

19 (Forecast)

Profit for the Year*

*� Profit�for�the�year�attributable�to�owners��

of�the�parent

�Current�assets　 �Non-current�assets�Core�operating�cash�flow

�Investment�cash�flow�(Net)

�Free�cash�flow

Cash Flow Total Assets

¥ billion

‒45

15

‒15

‒30


0

19 (Forecast)181716

¥ billion

0

750

600

150

450

300

As of March 31

181716

Vision

Business

management

Finance Logistics

Risk managementMarketing

Energy domain

Contribute to the supply

of renewable energy

Promote electric furnace

and recycling businesses

Promote electric vehicles and seek

to reduce the weight of vehicle frames

Automotive domain

Infrastructure domain

Protecting the

global environment and

contributing to the creation

of a sustainable society

Strengthening solutions through

the use of multi-materials and the promotion

of digital transformation

Multi-materials Digital transformation


Mineral�&�Metal�Resources�Segment



of�Mineral�&�Metal�Resources�Business�Unit

Shinichiro�Omachi

Business Activities

Through�business�development,�

investment�and�trading�of�ferrous�and�

nonferrous�metals�and�resources,�etc.,�

we�work�to�develop�integrated�value�

chains�which�deliver�a�stable�supply�of�

resources�and�materials�essential�to�

industrial�society.�We�also�take�part��

in�resource�recycling,�developing�

industrial�solutions�that�address�

environmental�issues.


・��Profit�base�supported�by�the�three�

pillars�of�cost�competitiveness,�

production�volume,�and�ore�reserves

・��Business�opportunities�born�out��

of�functions,�trust,�network,�and�

distribution�channels�we�have�

cultivated�in�various�industries�

Mineral & Metal Resources Business Unit

Coal�and�infrastructure�

businesses�/�Moatize�

coal�mine�and�Nacala�

infrastructure�project�

(Mozambique)


Business�opportunities •� Increased�need�for�high-quality�resources�following�rapid�changes�in�environmental�policies�primarily�in�China•�Heightened�importance�to�secure�a�stable�supply�of�raw�materials�for�secondary�batteries�in�light�of�the��

widespread�use�of�electric�vehicles

Business�(competitive)�

risks

•�Changes�in�the�government�policies�of�each�country�brought�about�by�the�transition�to�a�low-carbon�society•� Impact�of�technological�innovation�and�other�factors�on�the�supply�and�demand�of�commodities

Basic Strategies

Secure competitive mineral and metal resources and contribute to their stable supply•�Establish�a�robust�profit�base�that�steadily�captures�upside�potential

Create trading and investment businesses to fulfill the needs of our customers and partners•�Expand�businesses�in�the�mineral�and�metal�resources�value�chain�from�raw�material�supply�to�recycling

Promote businesses that contribute to sustainable economic growth while preserving the global environment•�Contribute�to�the�nation�building�of�resource-supplying�countries�and�the�development�of�the�global�economy,�and�reduce�environmental�

impact�through�increased�efficiency


Area Our�Approach

Iron�ore •�We�are�increasing�production�at�Vale�Carajas�S11D�and�BHP�Jimblebar,�working�to�develop�BHP�South�Flank,�and�

automating�operations�in�Western�Australia.�Through�these�and�other�means,�we�are�promoting�the�further�reinforce-

ment�of�a�profit�base�supported�by�the�three�pillars�of�cost�competitiveness,�production�volume,�and�ore�reserves.

Coal •� In�Mozambique,�we�aim�to�establish�a�profit�base�for�the�Moatize�coal�mine�and�the�Nacala�infrastructure�project.��

In�Australia,�we�are�strengthening�the�structure�of�existing�businesses�through�such�means�as�the�cost�reduction�of��

coking�coal.�Also,�we�are�moving�forward�with�efforts�to�enhance�our�portfolio�by�adding�highly�competitive�assets.�

Furthermore,�for�thermal�coal,�we�refrain�from�accumulating�new�assets�while�existing�assets�are�under�thorough�

review�for�divestiture�possibilities.

Copper�and�others •�We�are�enhancing�the�quality�of�existing�businesses�through�operational�improvements�at�Caserones�and�Anglo�

American�Sur.�We�are�also�promoting�efforts�in�growth�areas�by�working�to�establish�a�value�chain�for�raw�materials�

used�in�secondary�batteries.



¥ billion


181716

‒200

‒100

0

100

200

300

19 (Forecast)

Profit for the Year* Cash Flow Total Assets

‒120

240

180

0

‒60

120

60

¥ billion


19 (Forecast)181716

0

2,400

1,800

600

1,200

As of March 31

181716

¥ billion



Interest�(%)


16/3 17/3 18/3

(Consolidated)�Iron�ore�mining��

operations�in�Australia

Mining�and�sales�of�Australian�iron�ore Var. 74.7 102.9 110.4

(Consolidated)�Coal�operations�in�

Australia

Mining�and�sale�of�coal�in�Australia Var. (26.4) 34.3 46.3

(Consolidated)�Coal�and�rail�&�port�

infrastructure�business�in�Mozambique

Investment�in�coal�and�rail�&�port�infrastructure�

business�in�Mozambique

100.0� — (1.5) 2.6

Japan�Collahuasi�Resources�B.V. Investment�in�the�Collahuasi�copper�mine�in�Chile 91.9 1.4 3.3 6.3

Oriente�Copper�Netherlands�B.V. Investment�in�the�Chile-based�copper�company�

Inversiones�Mineras�Acrux�SpA

100.0� (99.7) (8.6) 2.6

Mitsui�Bussan�Copper�Investment�&�Co.,�

Ltd.

Investment�in�the�Caserones�copper�mine��

in�Chile

100.0� (52.1) (8.9) (22.6)

�Iron�ore　 �Coal　 �Copper　 �NickelChart of Individual Strategies

Robe�River�(Australia)

Mt.�Newman�/�Yandi�/�

Goldsworthy�/�Jimblebar�(Australia)

South�Walker�Creek�/��

Poitrel�(Australia)

Moatize�/�Nacala�(Mozambique)

Collahuasi�(Chile)

Anglo�American�Sur�(Chile)

Caserones�(Chile)

Coral�Bay�/�Taganito�(Philippines)

Hyuga�Smelting�(Japan)

Moranbah�North�/��

Capcoal�/�Dawson�(Australia)

Kestrel�(Australia)

Rio Tinto

BHP

Anglo American

Glencore

Codelco

Pan Pacific Copper

Sumitomo Metal Mining

Vale

Mits

ui


of�the�parent





Machinery�&�Infrastructure�Segment Infrastructure Projects Business Unit

Integrated Transportation Systems Business Unit I

Integrated Transportation Systems Business Unit II

Managing�Officer,


of�Infrastructure�Projects�

Business�Unit

Yoshio�Kometani



of�Integrated�Transportation�


Shingo�Sato

Managing�Officer,


of�Integrated�Transportation�


Takeshi�Setozaki

Business Activities

We�contribute�to�the�development�of�

countries�and�the�creation�of�better�

lives�through�the�long-term,�reliable�

supply�of�indispensable�social�infra-

structure�such�as�power,�gas,�water,�

railways�and�logistics�infrastructure.�

While�strengthening�contact�points�

with�end�users�including�consumers,�

we�provide�sales,�financing,�lease,�

transportation�and�logistics,�and�

investment�in�various�areas,�including�

large-scale�plants,�marine�resource�

development�facilities,�ships,�aerospace,�

railways,�motor�vehicles,�and�mining/

construction/industrial�machinery.


・��Extensive�customer�base�and�col-

laboration�with�prestigious�partners

・��Existing�infrastructure�assets��

supported�by�stable�demand

・��Transition�to�high-quality�assets�

through�increased�productivity

Offshore�energy�/�FPSO�

(Floating,�Production,�

Storage,�and�Offloading�

system)�(Brazil)

Ⓒ MODEC


Business�opportunities •�Shift�to�a�low-carbon�society�in�response�to�climate�change•�Accelerating�changes�of�industrial�structure�following�technological�innovation�and�digital�transformation•�Expansion�of�the�mobility�market•�Movement�from�ownership�to�usership�(leasing,�rentals,�sharing)

Business�(competitive)�risks •�Strengthening�of�environmental�regulations•�Entry�of�competitors�from�other�industries

Basic Strategies

Thoroughly reinforce a sustainable profit base•�Reduce�costs�and�improve�management�efficiency�through�the�introduction�of�AI�and�IoT;�steadily�complete�assets�under�construction;�and�

expand�business�through�bolt-on�investments

Implement strategic lifecycle management•�Recycle�assets�at�the�appropriate�time�and�constantly�improve�portfolio�quality�by�capitalizing�on�opportunities

Enter new business domains•�Take�on�challenges�in�the�new�growth�area�of�mobility�as�well�as�challenges�in�new�infrastructure�businesses


Area Our�Approach

Next-generation�electric�power� •�We�are�stepping�up�the�pace�of�initiatives�geared�toward�distributed�power,�energy�management�

services,�and�renewable�energy.

Automotive�and�construction�

equipment

•�We�are�making�advancements�in�upstream�businesses,�such�as�electric�vehicles,�storage�batteries,�and�

engineering,�as�well�as�downstream�businesses,�such�as�services�and�leasing.

Ships,�aerospace,�and�rail •�We�are�bolstering�our�lease,�trading,�and�maintenance�services,�while�also�working�to�improve�the�

quality�of�our�portfolio�to�contribute�to�the�shift�toward�a�low-carbon�society.





Interest�(%)


16/3 17/3 18/3

(Consolidated)�IPP�businesses Investment�in�power�generation�businesses Var. (41.5) 8.6 46.4

(Consolidated)�FPSO/FSO�leasing�businesses FPSO/FSO�leasing Var. 7.6 7.8 9.1

(Consolidated)�Gas�related�businesses Gas�distribution�businesses�in�Brazil�and�Mexico Var. 3.0 8.9 7.7

Penske�Automotive�Group,�Inc. Automotive�retailer 15.7 6.7 6.3 11.1

(Consolidated)�Truck�leasing�and�rental�

businesses

Truck�leasing,�rental,�and�logistics�businesses 100.0 2.0 2.2 4.3

(Consolidated)�Rolling�stock�leasing�

businesses

Freight�car�and�locomotive�leasing Var. 4.7 3.3 4.5

VLI�S.A. Integrated�Freight�Transportation 20.0� 3.1 2.2 2.3

0

20

40

60

80

100

¥ billion


181716 19 (Forecast)

‒80

‒40

0

40

80

120

160

¥ billion


19 (Forecast)181716

0

2,500

2,000

500

1,500

1,000

As of March 31

181716

¥ billion

Automotive

New�business�platforms�in�the�mobility�

field�by�leveraging�our�customer�base

Construction equipment

Leveraging�of�comprehensive�strengths�

in�the�construction/mining�equipment,�

machine�tool,�and�agricultural�equipment�

businesses

Ships

•� �Leveraging�of�comprehensive�sales/

purchasing�and�owner�functions

•��Diverse�range�of�transportation�and�

sales�solutions�in�the�LNG�business

Aerospace

•� �Providing�solutions�for�aircraft/engine�

leasing,�and�freighter�conversion�

through�various�functions

•��Promoting�involvement�in�aviation/

space�industries

Rail

Providing�solutions�through�a�wide�

range�of�function�in�the�infrastructure�

construction,�rolling�stock�leasing,�oper-

atorship,�and�train�station�businesses

16

0 a

ffilia

ted

co

mp

an

ies

Competitiveness

Electric power

•� �Total�power�generating�capacity�of�

approximately�9.3GW

•�Project�operatorship

•�Well-balanced�power�generation�

portfolio�in�terms�of�region�and�fuel�

Graph 1, 2

Offshore energy

•� �Robust�structure�for�collaboration��

with�MODEC�Inc.

•� �Abundant�project�achievements�for�

Petróleo�Brasileiro�S.A.�—�Petrobras

•��Stable�profits�from�18�FPSO/FSO�

Gas distribution

•� �Strategic�partnership�with�Petrobras

•��Nearly�50%�share�of�Brazil’s�gas�distri-

bution�volume

Ⓒ MODEC

Fuel

Renewable�

energy

16%

Coal

22%

Gas

62% Region

Americas

34％

Asia�and�Australia

32％

Africa

7％

Middle�

East

26％Graph 1 Graph 2



of�the�parent





Managing�Officer,

Chief�Operating�Officer�

of�Basic�Materials�

Business�Unit

Sayu�Ueno

Managing�Officer,


of�Nutrition�&�Agriculture��

Business�Unit

Kohei�Takata

Managing�Officer,


of�Performance�Materials�

Business�Unit

Takeo�Kato

Business Activities

Our�chemicals�business�encompasses�trade��

and�investment�in�a�range�of�industries,�from�

upstream�and�midstream�chemicals�such�as�basic�

chemicals�and�fertilizer�and�inorganic�resources,�

to�downstream�chemicals�which�meet�diverse�

market�needs,�including�functional�materials,�

electronics�materials,�fertilizers,�agrochemicals,�

feed�additives,�flavorings,�and�specialty�chemi-

cals.�We�are�also�pursuing�new�initiatives�in�food�

science,�tank�terminals�and�carbon�fiber.


・��Handling�of�products�across�a�broad�range�of�

domains�and�a�robust�client�base�around�the�

globe

・��Business�creation�through�trading�that��

fully�leverages�our�network�and�project�

management

・��High�level�of�investment�efficiency�by�actively�

driving�business�initiatives

Trading�/�Mitsui’s��

sulphur�carrier�

Sulphur�Guardian


Business�opportunities •�Rise�in�potential�businesses�where�industries�intersect�following�the�emergence�of�increasingly�more�complex�

industrial�structures•�Need�for�diversification�and�high�performance�of�chemicals�and�materials�arising�from�heightened�environmental�

awareness•�Need�for�increased�food�production�due�to�increasing�global�populations,�and�need�for�high�added�value��

resulting�from�a�rising�middle�class�and�a�sharper�awareness�of�health


risks

•�Deterioration�of�customer�base�and�the�risk�of�existing�business�models�becoming�obsolete�due�to�changes�in��

industrial�structures

Basic Strategies, Our Approach & Progress

Basic�Strategies Our�Approach�&�Progress

Execute�bolt-on�

investments

We�are�promoting�plans�to�expand�methionine�production�and�specialty�businesses�with�Novus�International�Inc.�

We�are�also�reinforcing�the�profit�bases�of�tank�terminal�businesses�in�the�U.S.�and�Europe�as�well�as�methanol�

businesses�in�the�Middle�East�and�the�U.S.,�etc.

Reinforce�trading�

capabilities

By�combining�our�regional�expertise,�which�is�deeply�connected�to�local�business�partners�and�customers,�extensive�

product�expertise,�and�Mitsui’s�functional�expertise,�we�are�providing�added�value�to�customers�and�realizing�steady�

business�expansion.

Engage�in�new�growth�

opportunities

We�are�accelerating�initiatives�in�the�domains�of�performance�materials,�mobility,�IoT,�nutrition,�and�agriculture.

Please�see�“Establishing�Selected�New�Growth�Areas”�on�pages�046�and�047.

Trading-related Gross ProfitUnit:�¥�billion

08/3 19/3(Forecast)

1,406

2,786

17/3 20/3(Forecast)

18/3

8087

100

ITC Tank CapacityUnit:�thousand�m3


Chemicals�Segment Basic Materials Business Unit

Performance Materials Business Unit

Nutrition & Agriculture Business Unit


0

50

40

20

30

10

¥ billion



‒70

70

35

0

‒35

¥ billion



0

1,200

900

300

600

As of March 31

181716

¥ billion



Interest�(%)


16/3 17/3 18/3

Novus�International,�Inc. Manufacture�and�sales�of�feed�additives 80.0� 20.9 8.7 0.5

Intercontinental�Terminals�Company�LLC Chemical�tank�leasing 100.0� 5.5 4.8 13.3

MMTX�Inc. Investment�in�methanol�producing�business�

in�the�U.S.�and�sale�of�products

100.0� (2.8) 1.7 2.9

MITSUI�&�CO.�PLASTICS�LTD. Sales�and�marketing�of�plastics�and�chemicals 100.0� 2.8 3.2 3.8

(Consolidated)�Mitsui�AgriScience�International Investments�in�crop�protection�businesses�in�

Europe�and�the�Americas

100.0� 1.5 1.6 1.7

Engage in New Growth Opportunities

Global Network

Consolidated global workforce

Approx. 5,000

Consumer

products

Dental × Digital

Electronics

Coating

materials

Food &

Agriculture

Nutrition

Broad range of product areas

and customer base

Overseas locations

79 countries

Agricultural�

inputs

Advanced�

materials

Basic petrochemicals

Human�

nutrition

Performance�

materials

Tank

terminal

Specialty�

chemicals Methanol / Ammonia

Animal�

nutrition

Basic Materials Business UnitPerformance Materials Business Unit Nutrition & Agriculture Business Unit

Mobility

Healthcare



of�the�parent




Performance materials

•��Reach�agreement�to�invest�in�coating�material�businesses�in�Europe

•��Conduct�F/S�of�manufacturing�and�sale�of�SOFTANOL®�products��

in�Thailand

Mobility

•��Develop�high-performance�materials�

and�chemical�compounding�businesses

•��Promote�initiatives�toward�lighter�

automobiles

IoT

•��Invest�in�CONNECTEC�JAPAN�Corporation


•��Complete�takeover�bid�of��

SODA�AROMATIC�Co.,�Ltd.�and�

subsequently�delist�the�company

•��Invest�in�evidence-based��

nutraceutical�business

•��Invest�in�seed�business�and�

expand�agricultural�inputs��

distribution�business


Managing�Officer,


of�Energy�Business�Unit�I

Masaharu�Okubo



of�Energy�Business�Unit�II

Hirotatsu�Fujiwara


Business�opportunities •�Expansion�of�LNG�and�gas�businesses�that�have�a�relatively�low�environmental�impact•�Emergence�of�opportunities�to�undertake�initiatives�in�areas�related�to�renewable�energy�and�new�energy


risks

•�Unexpected�long-term�stagnation�of�oil�and�gas�prices•�Adverse�impact�on�supply�and�demand�stemming�from�changes�to�environmental�policies�in�each�country�due�to�

the�shift�to�a�low-carbon�society


Basic�Strategies Our�Approach

Establish�a�competitive�

upstream�asset�

portfolio

•�We�are�strengthening�the�competitiveness�of�existing�assets,�acquiring�new�high-quality�assets,�and�promoting�the�

expansion�of�our�LNG�production�capacity�(we�are�also�continuously�reviewing�our�cost�competitiveness�and�

carefully�selecting�new�projects�for�investment).•�We�are�expanding�businesses�for�gas�that�has�relatively�low�greenhouse�gas�emissions.�Demand�for�gas�is��

expected�to�increase�over�the�long�term.•�As�crude�oil�demand�is�expected�to�plateau�between�2030�and�2040�under�some�scenarios,�we�are�managing�the�

upstream�crude�oil�business�bearing�in�mind�cost�competitiveness�and�timeframes.

Increase�profit�in�

midstream�and�

downstream�busi-

nesses�by�leveraging�

Mitsui‘s�functions

In�addition�to�supplying�our�customers�with�energy,�we�are�pursuing�a�variety�of�other�efforts�to�develop�value�

chains.�These�include�promoting�trading,�and�marketing�activities�that�capture�opportunities�from�environmental�

changes�such�as�the�shale�gas�revolution�and�changes�in�government�policies;�acquiring�high-quality�assets��

and�expanding�businesses�in�the�midstream�and�downstream,�including�LNG�vessels;�and�developing�power�

generation�and�other�related�businesses.

Expand�renewable�

energy�and�new�

energy�businesses

It�is�expected�that�the�demand�from�society�for�non-fossil�fuels�and�renewable�energy�will�grow�and�that�the�

reduced�cost�of�these�types�of�fuel�and�energy�will�encourage�their�widespread�use�going�forward.�Under�such�

circumstances,�we�are�stepping�up�our�efforts�toward�the�biomass�power�generation�project�in�Tomakomai��

and�Shimokawacho�in�Hokkaido,�our�efforts�in�domestic�and�international�geothermal�business,�and�the�next-�

generation�energy�businesses�such�as�hydrogen.�Furthermore,�we�have�invested�in�the�U.S.-based�LanzaTech�Inc.,�

which�uses�microorganisms�to�develop�gas�fermentation�technology.�Through�this�investment,�we�are�taking�steps�

to�convert�greenhouse�gases�into�energy�sources�and�chemical�products.

Business Activities

Through�upstream�development,�

logistics�and�trading�of�energy�

resources�such�as�oil,�natural�gas/LNG,�

coal�and�uranium,�we�contribute�to�

the�stable�supply�of�energy�vital�to�

society.�In�addition,�as�part�of�efforts�to�

achieve�a�low-carbon�society,�we�are�

actively�involved�in�environmental�

and�renewable�energy�businesses.


・��Highly�competitive,�high-quality�

asset�portfolio�(growing�production�

volume,�reserves,�and�reinforced�

LNG�production�capacity)

・��Quality�business�opportunities�born�

out�of�our�long-cultivated�logistics�

functions,�network,�and�trust

LNG�business�/

Sakhalin�II�LNG�project

(Russia)


Energy Business Unit I

Energy Business Unit II

ⒸSakhalin�Energy

Energy�Segment


¥ billion


181716

‒25

0

25

50

75

100

19 (Forecast)

¥ billion


181716

‒240

‒120

0

120

240

19 (Forecast)

As of March 31

181716

0

600

1,200

1,800

2,400

¥ billion



Interest�(%)


16/3 17/3 18/3

Mitsui�Oil�Exploration�Co.,�Ltd. Exploration,�development�and�production�of�oil�and�natural�gas 74.3 9.9 6.7 11.5

Mitsui�E&P�Middle�East�B.V. Exploration,�development�and�production�of�oil�and�natural�gas�

in�Middle�East

89.7� (15.4) 2.5 3.5

Mitsui�E&P�Australia�Pty�

Limited

Exploration,�development�and�production�of�oil�and�natural�gas�

in�Oceania

100.0� (5.6) 1.7 3.9

Mitsui�&�Co.�Energy�Trading�

Singapore�Pte.�Ltd.

International�trading�of�petroleum�products�and�crude�oil 100.0� 3.6 1.2 (4.4)

Mitsui�E&P�Mozambique�Area�

1�Limited

Development�of�LNG�project�in�Mozambique 50.0 (6.6) (3.1) (3.4)

Greater Enfield

Development�of�previously��

discovered�oil�fields�that�leverages�

existing�production�facilities

Waitsia

Development�of�one�of�the�largest�

onshore�gas�fields�in�Australia�that�is�

cost�competitive,�located�near�

demand�and�existing�facilities

Cameron LNG

Steady�supply�of�LNG�

from�the�U.S.�to�the�

global�market

Sakhalin Ⅱ LNG Third Train

Expansion�of�an�additional��

liquefaction�train�through�bolt-on�

investment�that�leverages�existing�

facilities�such�as�pipelines

Browse

Project�that�leverages�the�existing�

equipment�of�the�NWS�project��

and�aims�to�commercialize�highly�

competitive�gas�fields

Kaikias

Development�of�an�oil�field�that��

is�cost�competitive�and�leverages�

existing�facilities.�Production�

commenced�in�May�2018

Tempa Rossa

Development�of�the�largest�

discovered�onshore�oil�fields�

in�Western�Europe

Mozambique LNG

Project�with�high�cost�competitiveness�

and�an�enormous�amount�of�proved��

gas�reserves�in�which�Mitsui�has�been�

involved�since�the�exploration�phase

● Oil　 �Gas

Asset Portfolio That Will Contribute to Future Profits



of�the�parent





Managing�Officer,


of�Food�Business�Unit

Miki�Yoshikawa

Managing�Officer,


of�Healthcare�&�Service�

Business�Unit

Koji�Nagatomi

Managing�Officer,


of�Food�&�Retail�Management�

Business�Unit

Yoshiki�Hirabayashi

Managing�Officer,


of�Consumer��

Business�Unit

Reiji�Fujita

Business Activities

Adapting�to�changes�in�consumption�

and�lifestyles�while�meeting�consum-

ers’�diverse�needs,�we�provide�value-

added�products�and�services,�develop�

businesses�and�make�investments�in�

business�fields�such�as�food�resources�

and�food�products,�retail�services,�

healthcare,�outsourcing,�fashion�and�

textiles,�forestry�plantation�resources,�

and�real�estate-related�business.


・��Global�network�for�the�origination�

and�sale�of�grains�and�other�

products

・��Trust-based�relationships�with�

numerous�prestigious�partners�in�

the�value�chains�of�Japan’s�foodstuff�

and�food�product�markets

・��Extensive�contact�points�with�

consumers

Real�estate�business�/�

Elderly�housing�with�

home-care�services�in�

the�U.S.


Business�opportunities •�Rising�need�for�securing�food�resources�and�securing�a�sustainable�food�supply•� Increased�demand�for�securing�the�safety�and�reliability�of�food�as�well�as�for�providing�food�with�high�added�

value�due�to�the�emergence�of�a�growing�middle�class•�Heightened�need�for�healthcare�services�resulting�from�changes�to�the�pattern�of�illnesses�and�the�rapidly�aging�

population•�Structural�changes�to�the�consumer�market�brought�about�by�technological�innovation,�higher�standards�of�living,�

and�various�lifestyle�changes


risks

•� Impact�of�a�shift�in�production�areas�and�other�factors�caused�by�import�regulations�on�global�logistics•�Climate�change,�infectious�diseases�in�livestock�and�marine�products,�etc.


Area Our�Approach

Food�Business�Unit •�We�have�established�our�business�domains�as�proteins,�sugars,�oils�&�fats,�staple�foods,�grain�and�feed�networks,�

and�value�materials.�From�a�nutrient-oriented�perspective,�we�are�establishing�a�global�business�foundation�in�

each�of�these�domains.

Food�&�Retail�

Management�Business�

Unit

•�We�are�refining�our�existing�functions�such�as�DCM�and�logistics�by�utilizing�digital�transformation,�robotics,�and�

other�technologies.•�We�are�also�working�to�enhance�the�value�of�existing�assets�and�acquire�new�assets�by�equipping�ourselves�with�

functions�to�provide�retail�solutions.

Healthcare�&�Service�

Business�Unit

•�We�are�strengthening�existing�business�and�acquiring�operatorships�in�order�to�expand�healthcare�ecosystems�that�

combine�the�five�elements�of�places,�people,�goods,�services,�and�information.�By�doing�so,�we�are�strengthening�

healthcare-related�assets.

Please�see�“Establishing�Selected�New�Growth�Areas”�on�pages�046�and�047.

Consumer�Business�

Unit

•�We�are�working�continuously�to�strengthen�the�functions�of�existing�businesses�within�the�domains�of�real�estate,�

fashion,�textiles,�and�day-to-day�products.�To�capitalize�on�business�opportunities,�we�are�also�promoting�efforts�to�

reposition�ourselves�to�target�customer�segment�that�can�provide�larger�profit�pools.


Lifestyle�Segment Food Business Unit

Food & Retail Management Business Unit

Healthcare & Service Business Unit

Consumer Business Unit


¥ billion


181716

‒30

‒20

‒10

0

10

20

30

19 (Forecast)

¥ billion


181716

‒90

‒60

‒30

0

30

60

19 (Forecast)

0

2,000

1,600

400

1,200

800

As of March 31

181716

¥ billion



Interest�(%)


16/3 17/3 18/3

Multigrain�Trading�AG Origination�and�merchandising�of�agricultural�products 100.0� (30.2) (1.2) (47.7)

Mitsui�Sugar�Co.,�Ltd. Manufacture�of�refined�sugar 32.2 2.0 5.1 3.3

WILSEY�FOODS,�INC. Investments�in�edible�oil�products�company 90.0� 5.1 3.5 3.4

IHH�Healthcare�Berhad* Healthcare�related�business 18.0 4.1 17.3 1.6

AIM�SERVICES�CO.,�LTD. Contract�food�services 50.0� 1.6 1.9 2.3

Mitsui�&�Co.�Real�Estate�Ltd. Real�estate�sales,�leasing,�management�and�consulting 100.0� 8.5 2.4 2.8

*�IHH�Healthcare�Berhad�became�a�direct�investment�through�a�share�transfer�from�MBK�Healthcare�Partners�Ltd.�on�January�25,�2018.

Examples of Initiatives

Initiatives in global food transactions

•� �Import,�domestic�sales,�and�multinational�trade�of�food�materials�

from�major�production�areas�such�as�the�U.S.,�Brazil,�Australia,�

Thailand,�and�Canada;�utilization�of�hedge�transactions�through�

futures

•� �Livestock�and�marine�products�business�that�centers�on�domestic�

livestock�and�overseas�marine�product�assets;�coffee�trading�that�

leverages�economy�of�scale;�and�value�ingredients�businesses,�

such�as�teas,�fruit�juices,�and�dairy�products,�that�leverage�our�

quality�control�and�product�development�capabilities

Initiatives in the food and retail management business

•� �Providing�value�to�7-Eleven�Inc.�by�refining�our�functions�for�

supply,�procurement,�logistics,�etc.

•� �Acquiring�and�understanding�consumer�data�and�insight,��

equipping�ourselves�with�retail�solution�functions�aimed�at�the�

diversification�of�products,�services,�and�sales�floors,�while�

improving�the�quality�of�existing�assets�and�acquiring�new�

business�assets

� �Merchandising�domains,�such�as�prepared�foods,�commercial�

foods,�and�food�materials

� �Retail�domains�such�as�overseas�franchising,�“grocerants,”��

and�home-delivered�meals

Initiatives in the real estate business

•� �Accumulation�of�superior�properties,�primarily�by�operating�companies,�in�Japan,�the�U.S.,�and�Asia

•� �Value�enhancement�at�the�U.S.-based�MBK�Real�Estate�LLC,�which�entered�into�the�business�of�elderly�

housing�with�home-care�services�in�1990�through�improved�occupancy�rates;�entry�into�the�logistics�

facilities�development�business�following�increased�e-commerce�demand�in�the�U.S.

Share of domestic importsFiscal�year�ended��

March�31,�2017

Domestic��

import�volume

Company�share�of�

domestic�importsPosition

Corn 15.0�million�tons 18% Industry�No.�1

Soy�beans 3.2�million�tons 18% Industry�No.�1

Flour�for�milling 5.0�million�tons 21% Domestic�No.�1

Rapeseed 2.3�million�tons 35% Domestic�No.�1

Palm�oil�and�other�

vegetable�oils

0.9�million�tons 30% Domestic�No.�1

Raw�sugar 1.3�million�tons 25% Domestic�No.�1

Functions provided to 7-ElevenFunction Details

DCM�

functions*

Centralized�management�of�raw�materials�(food��

materials�for�boxed�lunches,�packaging�and�containers)

•��Inventory�management�and�recipe�and�traceability�

management,�etc.,�based�on�demand�forecasts�that�

give�consideration�to�such�factors�as�order�history�and�

campaigns�at�all�7-Eleven�stores

Logistics�

functions

Store�delivery

•��Top�share�of�delivery�in�all�controlled�temperature�

ranges

Wholesale�

functions

�Handling�of�processed�foods�and�liquor

*� Demand�chain�management�(DCM):�System�that�comprehensively�manages�

the�chain�with�demand�forecast�information�as�the�starting�point



of�the�parent





Managing�Officer,


of�IT�&�Communication�

Business�Unit

Masaki�Saito

Managing�Officer,


of�Corporate�Development��

Business�Unit

Shinichi�Kikuchihara

Business Activities

Through�our�ICT,�finance�and�logistics�

business,�we�work�on�a�diverse�range�

of�projects�aimed�at�developing�

innovative�business�and�expanding�

our�business�field.�At�the�same�time,�

we�promote�efforts�to�strengthen�our�

earnings�base�by�exploring�strategic�

projects�that�lead�to�new�business�

areas,�and�providing�specialized�

functions�on�a�global�basis.�


・��Network�with�prominent�business�

partners�in�Japan�and�overseas�and�

established�business�models�that�

leverage�our�customer�base

・��Development�and�fostering�of�

human�resources�that�oversee�

business�management,�investment,�

and�digital�transformation

Owner�and�operator��

of�real�assets�in�North�

America�/�CIM�Group


Business�opportunities •�Growing�value�of�data�assets�due�to�the�evolution�of�AI,�robotics,�and�IoT;�shift�of�power�toward�consumers•�Global�expansion�of�real�estate�asset�management�businesses•�Diversification�of�consumer�needs;�changes�and�expansion�in�the�logistics�industry�due�to�the�heightened�

awareness�of�labor�shortages�and�the�working�environment


risks

•�Uncertainty�of�technological�innovations,�new�services,�and�business�models•� Impact�of�decrease�in�money�easing�initiatives�and�interest�rate�trends�in�Europe�and�the�Americas�on�the�real�

estate�asset�management�business


Basic�Strategies Our�Approach�&�Progress

Bolster�profit�base�of�

domestic�affiliated�

companies�in�the��

ICT�domain

To�bolster�the�profit�base�of�major�domestic�affiliated�companies,�such�as�MITSUI�KNOWLEDGE�INDUSTRY�CO.,�LTD.,�

QVC�JAPAN�INC.,�and�Relia,�Inc.,�we�are�enhancing�our�business�promotion�capabilities�by�increasing�employee�

capabilities�and�sharpening�our�management�strengths.

Provide�specialized,�

high-value-added�

services�and�actively�

drive�initiatives

We�are�working�to�strengthen�the�wide�range�of�services�we�offer�to�both�institutional�and�individual�investors.�

These�include�alternative�asset�management�services�that�provide�Mitsui-owned�real�estate�assets,�insurance-linked�

securities,�and�other�products;�highly�sophisticated�consumer�goods�logistics�services�that�are�extremely�cost�

competitive;�and�corporate�value�improvement�services�where�we�invest�in�other�companies�to�help�improve�their�

management.

Support�efforts�to�

improve�corporate�

value�companywide

•�We�provide�support�for�establishing�structures�to�enhance�human�resources�so�that�they�can�contribute�to��

achieving�companywide�digital�transformation.•�We�offer�assistance�to�large-scale�M&A�projects�of�other�headquarter�business�units�as�well�as�support�and�consult-

ing�services�for�existing�business�turnaround�and�management�improvement.•�For�investments�in�next-generation�business�models,�we�carefully�select�new�domains�to�take�on�challenges�and�

pursue�those�challenges�with�a�focus�on�bolt-on�investments�that�leverage�Company�strengths.


Innovation�&�Corporate�Development�Segment IT & Communication Business Unit

Corporate Development Business Unit


‒5

15

10

5

0

¥ billion



‒45

15

0

‒15

‒30

¥ billion



0

600

450

150

300

As of March 31

181716

¥ billion



Interest�(%)


16/3 17/3 18/3

Asia�Pacific�Mobile�Pte.�Ltd. Investment�in�high-speed�mobile�service��

business�in�Indonesia

100.0� (2.2) (2.6) (5.0)

QVC�JAPAN�INC. TV�shopping�using�a�24-hour�dedicated�channel 40.0� 4.2 4.4 5.2

MITSUI�KNOWLEDGE�INDUSTRY�CO.,�LTD. Planning,�development�and�sales�of�informa-

tion�and�communication�systems

100.0� 0.6 1.3 2.1

JA�Mitsui�Leasing,�Ltd. Leasing�and�financing�business 31.4� 4.1 3.3 4.0

Mitsui�&�Co.�Global�Logistics,�Ltd. Domestic�warehousing�transportation�and�

customs�clearance,�and�real�estate�leasing,�

globally�integrated�transportation�services

100.0� 1.4 1.9 2.3

Mitsui�&�Co.�Asset�Management�Holdings�LTD. Real�estate�asset�management 100.0� 0.0 1.7 2.0

MITSUI KNOWLEDGE INDUSTRY CO., LTD. (MKI)

MKI’s�main�business�domains�are�the�establishment�of�

corporate�systems�and�networks�and�the�provision�of��

cloud�services.�In�the�fiscal�year�ended�March�31,�2018,�the�

company�acquired�a�large�number�of�high-quality�projects�

from�its�existing�customer�base,�thereby�realizing�increases�

in�sales�and�profits.�With�its�Digital�Trans�formation�Center�

acting�as�the�core,�MKI�is�contributing�to�the�digital��

transformation�of�the�entire�Mitsui�Group.

World Hi-Vision Channel, Inc.

Since�2007,�World�Hi-Vision�Channel,�Inc.�has�been��

operating�“BS12TwellV,”�a�24/7�free-to-air�BS�channel.��

The�company�has�been�gradually�improving�its�level�of�

recognition�and�steadily�increasing�its�profits.

QVC JAPAN INC. (QVC Japan)

QVC�Japan�is�a�television�shopping�company�in�Japan��

that�operates�under�the�U.S.-based�Qurate�Retail�Group.�

While�reinforcing�its�customer�base�with�a�high�percentage�

of�repeat�sales,�QVC�Japan�has�been�achieving�a�solid��

business�performance�year�after�year.�The�company�aims�to��

further�expand�profits�through�

various�measures,�including�4K�

broadcasts�that�are�slated�to�

begin�in�December�2018.

CIM Group (Owner and Operator of Real Assets

in North America)

In�2017,�Mitsui�invested�approximately�¥50�billion�in�CIM�

Group�(CIM)�and�funds�operated�by�CIM.�CIM’s�unique��

strategy�utilizes�its�in-house�expertise�to�create�value�in��

real�estate�and�infrastructure�assets,�benefiting�communi-

ties.�As�defined�by�CIM,�it�has�$28.6�billion�in�assets�owned�

and�operated.�Mitsui�contributes�to�CIM’s�business�diversifi-

cation�and�expansion�of�partner�and�co-investor�base,�by�

providing�access�to�Japanese�institutional�investors.

Mitsui & Co. Global Logistics, Ltd. (MGL)

MGL�has�operated�a�logistics�center�operation�business��

and�a�real�estate�leasing�business,�and�added�an�iron�and�

steel�machinery�and�equipment�transportation�business�

through�a�business�merger�with�Mitsui’s�other�logistics�service�

subsidiary,�which�has�strengthened�its�sales�capabilities.��

The�company�possesses�20�offices�in�seven�major�cities�

across�Japan�and�a�group�network�that�spans�150�cities�in��

35�countries�around�the�world.�In�addition,�the�company�

operates�a�warehouse�that�covers�700,000�m2�(roughly�the�

size�of�15�Tokyo�Domes),�which�is�the�largest�of�its�kind�in�

Japan.�Due�primarily�to�the�steady�operations�of�its�logistics�

center�and�acquisition�of�new�projects,�MGL�achieved�an�

increase�in�profits�in�the�fiscal�year�ended�March�31,�2018.

Major Businesses

ⒸQVC�JAPAN,�INC.



of�the�parent





General�Meeting�of�Shareholders

Board�of�Directors


Internal�Auditing�Div.

Secretariat

Human�Resources�&�General�Affairs�Div.

Legal�Div.

Corporate�Management�Committee

Headquarter�Business�Units

Audit�&�Supervisory�Board�Members

Iron�&�Steel�Products�Business�Unit

Audit�&�Supervisory�Board�Member�Div.

Mineral�&�Metal�Resources�Business�Unit

Infrastructure�Projects�Business�Unit

Integrated�Transportation�Systems�Business�Unit�I

Integrated�Transportation�Systems�Business�Unit�II


Performance�Materials�Business�Unit

Nutrition�&�Agriculture�Business�Unit




Food�&�Retail�Management�Business�Unit

Healthcare�&�Service�Business�Unit


IT�&�Communication�Business�Unit

Corporate�Development�Business�Unit

Regional�Business�Units

Americas�Business�Unit

EMEA�Business�Unit

Asia�Pacific�Business�Unit

Audit�&�Supervisory�Board

Total�Number�of�Offices�in�Japan�:� 12

•�Head�Office� :� 1

•�Offices� :� 6

•�Branches� :� 5

Total�Number�of�Overseas�Offices�:� 125

� Overseas�Trading�Subsidiaries

� � •�Head�Offices� :� 34

� � •�Others� :� 59

� Overseas�Offices

� � •�Branches� :� 2

� � •�Others� :� 30

� (66�countries�and�regions)

Mitsui�Global�Strategic�Studies�Institute

Corporate�Logistics�Development�Div.

New�Head�Office�Building�Development�Dept.

Corporate�Planning�&�Strategy�Div.

Investment�Administrative�Div.

Information�Technology�Promotion�Div.

Corporate�Communications�Div.

Environmental�•�Social�Contribution�Div.

CFO�Planning�&�Administrative�Div.

Global�Controller�Div.

Finance�Div.

Risk�Management�Div.

Investor�Relations�Div.

Business�Supporting�Unit

Planning�&�Administrative�Div.�(Metals)

Planning�&�Administrative�Div.�(Machinery�&�Infrastructure)

Planning�&�Administrative�Div.�(Chemicals)

Planning�&�Administrative�Div.�(Energy)

Planning�&�Administrative�Div.�(Food�&�Services)

Planning�&�Administrative�Div.�(Consumer�&�Healthcare)

Planning�&�Administrative�Div.�(Innovation�&�Corporate�Development)

Financial�Management�&�Advisory�Div.�I

Financial�Management�&�Advisory�Div.�II

Financial�Management�&�Advisory�Div.�III

Financial�Management�&�Advisory�Div.�IV

Regional�Business�Promotion�Div.

The�Structure�That�Supports�Mitsui

Organization Chart�(As�of�April�1,�2018)


Product and Regional ExpertiseMitsui�has�a�unique�operational�organization�that�is�built��

upon�the�two�axes�of�product�and�regional�expertise.�Under�

this�organization,�we�engage�in�its�business�activities�while�

leveraging�the�respective�strengths�provided�by�these�two��

axes�and�pursuing�collaboration�between�them.

� One�strength�provided�by�our�product�expertise�is�our��

16�Headquarter�Business�Units.�Each�Headquarter�Business��

Unit�formulates�comprehensive�strategies�for�each�product�it��

is�responsible�for,�and�these�strategies�integrate�our�domestic�

and�overseas�operations.�Guided�by�such�strategies,�our�Head-

quarter�Business�Units�promote�business�activities�around�the�

globe.�Furthermore,�we�are�working�to�deepen�the�horizontal�

connections�between�each�unit�in�order�to�leverage�our�

comprehensive�strengths.�By�doing�so,�we�are�promoting�

groupwide�businesses�through�collaborative�initiatives��

between�each�Headquarter�Business�Unit.

� One�strength�provided�by�our�regional�expertise�is�our�three�

Overseas�Regional�Business�Units.�We�have�divided�the�overseas�

markets�on�which�we�focus�into�three�regions—the�Americas;�

Europe,�the�Middle�East�and�Africa�(EMEA);�and�Asia�Pacific—and�

have�put�into�place�a�trilateral�structure�that�provides�indepen-

dence�to�each�region.�Acting�as�a�cornerstone�for�our�regional�

strategies,�each�Overseas�Regional�Business�Unit�is�entrusted�

with�the�business�operations�in�their�respective�area�of�respon-

sibility.�While�collaborating�with�our�Headquarter�Business�

Units,�the�Overseas�Regional�Business�Units�manage�a�diverse�

array�of�businesses�together�with�affiliated�companies�that�

operate�under�their�jurisdiction.�Furthermore,�the�Overseas�

Regional�Business�Units�function�as�expert�organizations�that�

have�thorough�knowledge�of�information�pertaining�to�their�

respective�area�of�responsibility,�and�this�knowledge�is�lever-

aged�to�form�close�relationships�with�prominent�local�compa-

nies.�In�these�ways,�the�Overseas�Regional�Business�Units�

provide�the�foundation�for�our�global�strategies.

� By�combining�the�product�strategies�of�the�16�Headquarter�

Business�Units�and�the�regional�strategies�of�the�three�Overseas�

Regional�Business�Units,�which�are�implemented�under�a�tri�-�

lateral�structure,�we�are�able�to�realize�an�organic�global�network.

President & Chief Executive Officer


Mineral & Metal Resources


Chemicals

Energy

Lifestyle

Innovation & Corporate Development

Iron & Steel Products Business Unit

Am

eric

as B

usin

ess U

nit

EM

EA

Bu

sine

ss Un

it

Asia

Pa

cifi

c B

usin

ess U

nit

Mineral & Metal Resources Business Unit

Infrastructure Projects Business Unit

Integrated Transportation Systems Business Unit I

Integrated Transportation Systems Business Unit II

Basic Materials Business Unit

Performance Materials Business Unit

Nutrition & Agriculture Business Unit

Energy Business Unit I

Energy Business Unit II

Food Business Unit

Food & Retail Management Business Unit

Healthcare & Service Business Unit

Consumer Business Unit

IT & Communication Business Unit

Corporate Development Business Unit

Corporate Staff Unit



of�Americas�Business�Unit

Katsurao�Yoshimori

Senior�Executive�Managing�Officer,

Chief�Operating�Officer�of�EMEA�(Europe,�

the�Middle�East�and�Africa)�Business�Unit

Yasuyuki�Fujitani

Senior�Executive�Managing�Officer,


of�Asia�Pacific�Business�Unit

Taku�Morimoto

*�China,�Taiwan,�South�Korea,�and�CIS�are�regions�under�the�direct�jurisdiction�of�the�Head�Office.

*�The�Headquarter�Business�Units�and�the�Overseas�Regional�Business�Units�have�thus�far�been�organized�into�product�segments�and�regional�segments.�However,�from�

the�fiscal�year�ended�March�31,�2018,�these�units�are�organized�under�seven�product�segments�in�consideration�of�decision�making�pertaining�to�management�resource�

allocation�as�well�as�the�evaluation�process�for�business�performance.

Chief Operating Officers of the Overseas Regional Business Units


Corporate GovernanceCHAPTER 4


Corporate GovernanceCHAPTER 4

074 External Directors Panel Discussion

078 Mitsui’s Corporate Governance

086 Execution of Business Activities

and Internal Controls

090 Board of Directors and

Independent Directors

092 Full-time and Independent Audit &

Supervisory Board Members

093 Executive Officers


External Directors Panel Discussion

Mitsui & Co. Investor Day 2018

External�Director:�Ms.�Izumi�Kobayashi

External�Director:�Mr.�Samuel�Walsh�

Facilitator:�Mr.�Leo�Lewis�(Financial�Times)

June�12,�2018

Izumi�KobayashiExternal�Director

Profile

1981/4� �Joined�Mitsubishi�Chemical�Industries,�Ltd.�

(currently�Mitsubishi�Chemical�Corporation)

1985/6� �Joined�Merrill�Lynch�Futures�Japan�Inc.

2001/12� �President,�Merrill�Lynch�Japan�Securities�Co.,�Ltd.

2008/11� �Executive�Vice�President,�Multilateral�Investment�

Guarantee�Agency,�World�Bank�Group

2014/6� �External�Director,�Mitsui�&�Co.,�Ltd.��

(current�position)

Samuel�Walsh�External�Director

Profile

1972/2� �Joined�General�Motors�Holden’s�Limited

1987/6� �Joined�Nissan�Motor�Australia

1991/9� �Joined�Rio�Tinto�Limited

2013/1� �Chief�Executive�Officer,�Rio�Tinto�Limited

2017/2� �Chairman,�The�Accenture�Global�Mining�

Executive�Council�(current�position)

2017/6� �External�Director,�Mitsui�&�Co.,�Ltd.��



Facilitator:�How�do�you�understand�the�

principal�role�and�responsibilities,�and�

targets�of�being�an�external�director��

at�the�Company?

Kobayashi:�While�I�think�that,�of�course,�

each�independent�director�has�their�

own�aim�on�how�to�contribute�to�

Mitsui,�I�believe�that�the�value�of�

independent�directors�lies�in�their�

ability�to�convey�the�views�of�the�

various�stakeholders�to�management�

and�reflect�these�views�in�the�decision-

making�process.�I�think�that�in�any�

corporation,�the�internal�discussions�

tend�to�be�based�on�“internal”�common�

sense,�instead�of�“entire”�common�

sense,�which�sometimes�is�different�

from�an�outside�perspective.�So�as�an�

independent�director,�I�try�to�bring�a�

different�view�to�the�discussions�and�

the�decision-making�process.�Each�

director�comes�from�a�different�back-

ground�and�has�a�different�profession,�

so�it�is�important�to�be�able�to�leverage�

those�different�experiences�in�order�to�

contribute�to�better�decision�making�

and�management�oversight.�

Since�the�introduction�of�the��

corporate�governance�code,�I�have�

seen�more�open�discussion�on�the�

Board�as�well�as�independent�Board�

members�having�a�bigger�voice�in�the�

decision-making�process.�In�fact,�I�have�

even�seen�decisions�made�by�internal�

management�changed�as�a�result�of�

the�influence�of�the�independent�Board�

members.�Also,�the�advisory�bodies�to�

the�Board,�including�the�Nomination�

Committee�and�Remuneration��

Committee,�have�benefited�from�great�

change.�For�example,�the�Nomination�

Committee�is�not�only�engaged�in�the�

nomination�of�senior�management��

but�is�also�involved�in�developing�the�

future�of�senior�management.�

Walsh:�Let�me�just�grab�some�reference�

here�in�terms�of�my�coming�on�the�

Board�as�the�only�non-Japanese�speaker.�

Simultaneous�translation�is�provided�

for�me�at�the�Board�meetings,�and�

Chairman�Iijima�mentioned�that�all�of�

the�Board’s�materials�would�also�be�in�

English.�So�that�helps�me�to�be�a�very�

active�participant�on�the�Board.�But�I�

think�coming�in�as�a�former�CEO�and��

a�member�of�two�boards,�that�of�Rio�

Tinto�and�of�Seven�West�Media,�the�

largest�media�company�in�Australia,�has�

taught�me�that�the�board�members,�as�

Kobayashi-san�said,�play�a�different�role.�

We’re�there�to�represent�shareholders.�

We’re�there�to�ensure�that�appropriate�

decision�making�is�carried�out—for�

example,�in�terms�of�cash�allocations�

between�investments�and�returns�to�

shareholders.�These�are�the�sorts�of�

priorities�that�today’s�shareholders�are�

addressing.�Growth,�environmental�

performance,�innovation,�cyber�secu-

rity,�and�so�on.�All�of�these�issues�are�

very�important,�and�we�need�to�look��

at�all�such�projects�and�report�on�them�

in�light�of�today’s�priorities.�

Personally,�I�think�governance�is�very�

strong�at�the�Company.�Remember,�we�

have�five�independent�directors,�but�we�

also�have�the�Audit�&�Supervisory�

Board.�Together,�we’re�a�very�noisy�

group�and�we�are�truly�able�to�express�

our�views,�which�may�be�strongly�

supportive�or�perhaps�opposing�

depending�on�the�issue—and�I�think�

that’s�a�very�healthy�process.�Also,�I’ve�

got�to�say�that�bringing�me�onto�the�

Board�was�a�big�step�by�Mitsui�and�I�

think�that�I�play�a�very�active�role.�

Facilitator:�How�have�you�used�your�

global�experiences�to�the�advantage�of�

the�Board?�

Walsh:�You�know,�certainly,�I�can�offer�

what�I’ve�learned�from�my�experiences�

dealing�with�a�number�of�issues�in�a�

whole�range�of�countries,�particularly�

with�resource�projects,�but�also�in�terms�

of�understanding�the�dynamics,�the�

risks,�and�the�areas�of�focus�required�of�

a�global�company.�Today,�the�world�is�a�

very�dynamic�place.�It’s�changing�ever�

so�rapidly,�and�it’s�very�important�that�

Mitsui�has�a�sense�of�urgency�that�it�is�

responding�when�necessary�to�the�

changes�in�the�environment.�And�I�

think�that�Mitsui�is�doing�exactly�that.�

Facilitator:�How�are�you�measuring,�in�

your�own�mind,�the�success�of�the�

Board�meetings�at�the�Company�and�

on�the�basis�of�those�measurements,�

what�progress�are�you�looking�for?

Walsh:�I�think�it’s�the�ability�of�the�

independent�directors�to�speak�their�

mind�and�for�that�to�be�accepted�and�

acknowledged�by�the�chairman.�The�

chair�is�looking�for�consensus.�Obvi-

ously,�if�there�was�a�majority�decision,�

there�are�far�more�executive�directors�

than�non-executive�directors.�Chairman�

Iijima�is�looking�for�consensus�in�the�

views,�and�he�strongly�considers�the�

views�of�the�non-executive�directors.�

The�process�is�very�healthy.�The�day�

before�a�Board�meeting,�we�have�a�

pre-Board�briefing.�And�that�enables�us�

to�inquire�deeply�into�the�issues.�It�also�

enables�us�to�raise�the�critical�questions�

that�we�are�likely�to�ask�at�the�Board�

meetings�and�also�give�management�a�

view�as�to�whether�they�support�it�or�

not.�To�me,�it’s�a�very�healthy�process�

because�it�gives�management�the�time�

to�draw�a�breath�and�to�understand��

the�type�of�questioning�or�the�type��

of�issues�that�will�be�raised�at�the��

Board�meetings�the�next�day.�The��

Board�meetings�move�very�quickly,��

so�it’s�important�to�have�the�scene�set��

in�advance.�

Kobayashi:�After�Mr.�Walsh�joined��

the�Board,�I�think�that�the�dynamics�of�

the�discussions�have�further�improved.�

The�internal�common�sense�that�I�

mentioned�earlier�is�not�only�within��

the�Company�but�also�within�Japanese�

society,�as�its�standards�sometimes�

differ�from�what�the�global�standards�

are.�Mr.�Walsh�always�shares�his�global�

perspective,�conveying�how�the�global�


market�sees�a�particular�trend,�which�

gives�us�both�a�fresh�outlook�on�the�

world�and�very�important�input�into�

management’s�decision�making,�

because�Mitsui�is�a�global�company�

and�as�such�we�have�to�be�globally�

competitive.�

Facilitator:�When�strategy�comes�up�as�

an�issue�for�the�Board�to�discuss,�what�

can�you�do�in�those�strategy�discus-

sions�to�really�make�your�views�known�

and�to�have�impact�on�the�discussions?

Kobayashi:�I�think�that�compared�to�the�

time�when�I�joined�the�Board,�the�time�

spent�on�strategy�has�been�increasing�

at�the�request�of�the�independent�

directors.�The�issue,�though,�is�not�the�

actual�time�spent�on�the�Board�discuss-

ing�strategy.�What’s�more�important�is�

that�once�we�develop�a�strategy�and�

growth�story,�we�have�to�then�think�

about�each�investment�and�day-to-day�

management�under�that�strategy�and�

follow�it�closely.�To�put�it�simply,�it�is�

easy�to�develop�a�good�strategy�to�

engage�with�investors,�but�what’s�

important�is�to�follow�through�on�that�

strategy.�So�I�think�that�the�role�of�the�

independent�directors�can�be�defined�

as�once�we�develop�a�strategy,�we�have�

to�ensure�that�every�proposal�is�per-

fectly�aligned�with�that�strategy�and�

also�determine�what�kind�of�value�to�

create�based�on�that�strategy.�

Walsh:�By�every�nature�in�long-term�

business,�strategy�is�important�in�terms�

of�setting�our�vision,�setting�our�direc-

tion,�setting�the�scene�for�our�42,000�

employees�as�we�take�the�business�

forward.�Strategy,�compliance,�gover-

nance,�monitoring—these�are�the�types�

of�roles�that�the�Board�plays�and�I�think�

the�key�role�is�actually�ensuring�that�the�

strategy�provides�sustainable�growth��

as�you�go�forward.�It’s�important�that�

Mitsui�has�a�very�clear�view�of�its�

long-term�strategy�but�also�that�it�

enables�employees�and�management�

to�work�in�that�direction.�

Facilitator:�Where�do�you�see�the�

external�director’s�role�in�keeping�an�

eye�on�mistakes�or�risks?�

Walsh:�Accountability�is�an�important�

issue�and�it’s�something�that�Mitsui�is�

strengthening�before�our�eyes,�but�

more�importantly,�recognizing�that�

there�will�be�some�mistakes�along�the�

line.�And�most�importantly,�to�learn�

from�our�mistakes.�In�the�discussions�

that�we�have�about�impairment,�yes,�

we�express�disappointment�that�the�

events�have�taken�place,�but�we’re�more�

focused�on�what�we’ve�learned�so�that�

we�can�ensure�that�such�a�situation�

doesn’t�happen�again.�But�on�the�Board,�

you�tend�to�compartmentalize�the�

business.�And�there�are�a�lot�of�really�

seriously�good�things�happening.�

Sometimes�on�the�Board,�though,�you�

think,�“All�we’re�talking�about�is�impair-

ment.”�But�that’s�not�really�true—there�

are�a�lot�of�very�good�things�happening.�

Facilitator:�What�would�you�say�are��

your�experiences�in�terms�of�being��

able�to�hold�the�Board�accountable�for�

improvements�in�competitiveness�and�

also�in�regard�to�ways�that�your�advice�

can�permeate�the�overall�atmosphere�

of�the�Board?�

Kobayashi:�One�of�the�collective�

thoughts�on�the�Board�is�that�the�

business�of�a�trading�company�is�not�

easy�for�investors�to�understand.�When�

we�talk�about�global�competitiveness,�it�

is�easy�to�explain�competitiveness�in�

terms�of�one�specific�product�or�indus-

try�area.�However,�it�is�very�difficult�to�

compare�a�trading�company�with�a�

competitor�in�one�specific�field.�So�what�

I�expect�of�management�is�to�make�the�

global�market�understand�the�value�of�

the�trading�company’s�business�model�

and�clearly�communicate�our�story�to�

investors�as�well�as�the�value�and�

differences�of�the�trading�company’s�

business�model�compared�with�those�

of�each�industry’s�specialized�compa-

nies.�So�in�this�regard,�I�feel�that�man-

agement�has�started�to�talk�more�about�

the�storyline�of�Mitsui.�The�challenge�

now�is�to�figure�out�how�to�link�our�

financial�results�with�our�own�story.�I�

think�that�is�one�way�in�which�the�very�

unique�business�model�of�a�trading�

company�can�illustrate�the�competitive-

ness�in�the�global�market,�which�entails�

being�able�to�compete�against�different�

business�models.�

Facilitator:�How�honest,�how�trans�parent�

are�the�discussions�on�the�weaknesses�

that�every�company�must�have?

Kobayashi:�The�weaknesses�are�in�

various�areas.�Even�though�Mitsui�is�a�

Japanese�company,�we�have�a�big�

franchise�all�over�the�world.�How�we�

External Directors Panel Discussion

So I think we need to have a better mix of regional and Tokyo

personnel even with regard to our Japanese business. Mobility within

our organization will be the key to improving our global position.

�Izumi�Kobayashi


leverage�the�diverse�human�resources�

outside�of�Japan�to�make�Mitsui�a�truly�

global�company�is�the�area�in�which�

Mitsui�can�further�improve.�

Walsh:�I�think�that�probably�the�biggest�

challenge�that�we�have,�along�with�

every�company�in�the�world,�is�the�

changing�nature�of�the�business�envi-

ronment�and�the�need�to�be�responsive.�

I�think�in�Mitsui’s�case,�we�do�a�very�

good�job�in�communicating,�engaging,�

and�involving�employees.�Because,�at�

the�end�of�the�day,�it’s�the�people�that�

are�going�to�implement�the�strategy;�

they�need�to�be�aware�of�how�they�as�

individuals�add�value.�Sometimes�

people�get�tied�up�in�“busy�work,”�in��

the�number�of�e-mails�they�have,�

whatever�the�case�may�be.�Without�

actually�realizing�how�they�physically�

add�to�the�value�of�Mitsui�and�improve�

its�efficiency,�every�single�employee�is�

at�risk�in�terms�of�how�they�do�their�job�

and�how�they�can�improve�on�how�they�

do�their�job.�And�most�importantly,�how�

Mitsui�uses�innovation�and�technology�

to�take�leaps�in�terms�of�the�efficiency�

in�what�it�does.�

Facilitator:�Do�you�feel�that�you’re�flying�

too�high�above�the�day-to-day�activities�

to�make�a�difference�or�do�you�think�

that�there�is�a�difference�you�can�make�

from�your�position?�

Walsh:�Clearly,�the�Board�needs�to�be�

up�above�looking�at�the�overall�busi-

ness�rather�than�getting�directly�in-

volved�in�the�management’s�job�to�any�

degree.�But�the�Board’s�role�is�there�to�

set�the�scene;�the�Board’s�role�is�to�

identify�the�sort�of�challenges�that�the�

business�is�facing�and�ensuring�that�

Mitsui�is�responding�to�that.�

Facilitator:�Kobayashi-san�mentioned�

that�there�is�a�distinct�difference�be-

tween�simply�being�global�and�having�

a�global�mind-set.�The�question�is,�what�

can�you�do�to�see�that�a�global�mind-

set�is�instilled,�and�where�would�you�

say�Mitsui�is�along�that�path?

Walsh:�I�think�the�key�issue�is�the�people�

at�Mitsui.�Our�people�are�one�of�the�key�

strengths�of�the�businesses�and�we�must�

ensure�that�we�make�good�use�and�take�

advantage�of�the�skills�and�experience�

that�our�42,000�employees�bring.�Half�of�

our�workforce�are�Japanese�and�half�are�

non-Japanese.�And�we�must�ensure�that�

we’ve�got�the�balance�right,�that�we’re�

taking�the�most�advantage�of�the�skills�

that�our�people�bring.�Reviewing�our�HR�

systems�is�right�on�our�agenda.�We�need�

to�ensure�that�we�are�modern�in�the�

approach�that�we�are�taking,�particu-

larly�when�dealing�with�millennials.

Facilitator:�You’ve�seen�companies�all�

around�the�world.�What�is�your�take�on�

the�Company’s�progress�in�governance?

Walsh:�In�my�opinion,�I�think�gover-

nance�is�very�strong.�As�I�have�said,��

I�think�the�external�directors’�oversight,�

plus�the�checks�and�balances�that�the�

Audit�&�Supervisory�Board�provides,�

works�very�effectively�from�where�I�sit.�

Kobayashi:�I�think�the�area�where�we�

need�to�do�more�is�how�we�can�better�

utilize�our�foreign�regional�personnel�in�

each�field�of�global�business.�Our�

regional�personnel�contributes�a�lot.��

But�unfortunately,�we�don’t�see�much�

influence�from�regional�personnel�at�

the�senior�management�level.�So�I�think�

we�need�to�have�a�better�mix�of�regional�

and�Tokyo�personnel�even�with�regard�

to�our�Japanese�business.�This�will��

give�voice�to�a�greater�majority�of�our�

global�workforce.�For�example,�we�can�

mobilize�our�talent�in�global�locations�

to�better�serve�areas�around�the�world�

where�help�is�needed.�Mobility�within�

our�organization�will�be�the�key�to�

improving�our�global�position.�

Walsh:�I�think�that�if�you�look�at�me�as�

an�example,�the�Company�has�gone�

through�a�great�deal�to�ensure�that�I’m�

effective,�to�ensure�that�I’m�adding�

value.�And�I�hope�in�some�small�way�

that�I’m�providing�a�leadership�role�for�

the�foreign�nationals�in�a�situation�

where�they�can�see,�well,�that�“There��

is�a�gaijin�(foreign�national)�on�the�

Board,�that�he�is�contributing,�that�he��

is�opening�the�door�for�me.”�I�hope�

that’s�how�people�see�it.

Facilitator:�So�you�wouldn’t�say�that�

you’ve�reached�the�peak�level�of�noise�

as�of�yet?

Walsh:�Oh,�no.�I’m�very�noisy.

Kobayashi:�Yeah,�I�think�that�the�inter-

nal�Board�members�are�having�a�very�

tough�time�because�we�are�so�noisy!

Together, we’re a very noisy group and we are truly able to express our

views. I think that I play a very active role.

�Samuel�Walsh


In terms of strengthening corporate governance, the Company worked to improve diversity among members of

the Board of Directors. At the same time, an even greater number of discussions were held at Board of Directors’

meetings regarding Mitsui’s future direction and business strategies. In these ways, the Company has been moving

forward with efforts to enhance the effectiveness of the Board of Directors.

Mitsui’s�Corporate�Governance

Corporate Governance Framework

Number of Directors

14

Organizational Format

Company with Audit

& Supervisory Board

Number of Audit &

Supervisory Board Members

5

Ratio of Female Directors /

Audit & Supervisory Board Members

15.8%

Ratio of Foreign Directors /

Audit & Supervisory Board Members

10.5%

��Number�of�Internal�Audit�&�

Supervisory�Board�Members�2

��Number�of�External�Audit�&�

Supervisory�Board�Members�3

�Number�of�Internal�Directors�9

�Number�of�External�Directors�5

Advisory�bodies 1Governance Committee 2Nomination Committee 3Remuneration Committee

Committee�chair Chairman�of�the�Board�of�Directors External�Director External�Director

Composition�

(including�

committee�chair)

Chairman�of�the�Board�of�Directors��

President�and�Chief�Executive�Officer�

1�Internal�Director

3�External�Directors

1��External�Audit�&�Supervisory�Board�

Member

Chairman�of�the�Board�of�Directors

President�and�Chief�Executive�Officer�



Member


2�Internal�Directors



Member

Role

To�study�the�state�and�future�vision�of�the�

Company’s�corporate�governance�with�

the�viewpoints�of�External�Directors�and�

External�Audit�&�Supervisory�Board�

Members.

To�study�the�selection�standards�and�

processes�to�be�applied�in�nominating�

Directors�and�Managing�Officers,��

establish�succession�planning�for�the�

President�and�Chief�Executive�Officer��

and�other�top�executives,�and�evaluate�

the�proposals�of�Director�nomination.

To�study�the�system�and�decision-�making�

process�related�to�remuneration�and�

bonuses�for�Directors�and�Managing�

Officers�as�well�as�to�evaluate�the��

remuneration�proposals�for�Directors.

Results�in�the�

fiscal�year�ended�

March�31,�2018

The�Governance�Committee�was�held�

three�times�in�the�year�ended�March�31,�

2018�and�carried�out�studying�the��

state�and�future�vision�of�the�Company’s��

corporate�governance�while�taking��

into�consideration�the�viewpoints�of�

External�Officers.

The�Nomination�Committee�was�held�

twice�in�the�year�ended�March�31,�2018,�

and�carried�out�establishing�the�selection�

standards�and�process�to�be�applied�in�

nominating�Directors�and�Managing�

Officers�and�evaluating�proposals�of�

Director�nomination.

The�Remuneration�Committee�was�held�

three�times�in�the�year�ended�March�31,�

2018�and�carried�out�a�review�of�the��

remuneration�system�for�Directors�and�

Managing�Officers,�and�evaluated��

compensation�proposals.

Framework�for�Execution�of�Business

Election�/�Dismissal Election�/�Dismissal Election�/�Dismissal

Placing�important�items�

on�the�agenda,�reporting�

on�business�execution

Appointment�and�dismissal;�

surveillance�of�selection,��

dismissal�and�conduct�of�dutiesAuditing

Auditing AdviceReporting

Coordination

Coordination

CoordinationAccounting�

audits


1 ��Governance�Committee

2 ��Nomination�Committee

3 ��Remuneration�Committee

Audit�&�Supervisory�Board�

Members�/�Audit�&�

Supervisory�Board

Independent�Auditors

Internal�Auditing�Division

General�Meeting�of�Shareholders


Name Position�at�the�Company

Term�of��

Office�

Stipulated

Governance�

Committee*

Nomination�

Committee*

Remuneration�

Committee*

Diversity

Female Foreigner

Directors

Masami�IijimaRepresentative�Director,��

Chairman�of�the�Board�of�Directors

1�year

◎ ○

Tatsuo�YasunagaRepresentative�Director,��

President�and�Chief�Executive�Officer○ ○ ○

Makoto�SuzukiRepresentative�Director,��

Executive�Vice�President○

Satoshi�TanakaRepresentative�Director,��

Executive�Vice�President○

Shinsuke�FujiiRepresentative�Director,��


Nobuaki�KitamoriRepresentative�Director,��

Senior�Executive�Managing�Officer

Yukio�TakebeRepresentative�Director,��

Senior�Executive�Managing�Officer

Takakazu�UchidaRepresentative�Director,��

Executive�Managing�Officer○

Kenichi�HoriRepresentative�Director,��

Executive�Managing�Officer

Toshiro�Muto Director�(External) ○ ◎

Izumi�Kobayashi Director�(External) ◎ ○ ○

Jenifer�Rogers Director�(External) ○ ○ ○

Hirotaka�Takeuchi Director�(External) ○

Samuel�Walsh Director�(External) ○ ○

Audit�&�

Supervisory�

Board�

Members

Joji�Okada Full-time�Audit�&�Supervisory�Board�Member

4�years

Takashi�Yamauchi Full-time�Audit�&�Supervisory�Board�Member

Haruka�Matsuyama Audit�&�Supervisory�Board�Member�(External) ○ ○

Hiroshi�Ozu Audit�&�Supervisory�Board�Member�(External) ○

Kimitaka�Mori Audit�&�Supervisory�Board�Member�(External) ○

Initiatives�to�Further�Improve�the�Effectiveness�of�the�Board�of�Directors

Year to March 31, 2017 Year to March 31, 2018 Further plans to enhance governance

•� �Ensured�time�to�review�agenda�items

•� �Improved�the�quality�of�materials�provided�to�

external�directors�to�assist�in�decision�making

•� �Enhanced�coordination�between�the�external�

members�as�well�as�between�the�accounting�

auditors�and�the�Internal�Auditing�Division

•� �Enhanced�discussions�regarding�the�direction��

of�management

•� �Increased�diversity�and�improved�skill�set�balance��

of�Board�members

•� �Created�more�opportunities�for�discussion�on�

Mitsui’s�long-term�direction,�including�its�corporate�

strategies�and�medium-term�management�plan

•� �Board�materials�improved�to�identify�points�that�

have�been�discussed�up�to�the�stage�of�referral�to�

the�Board�and�include�a�list�of�key�discussion�points,�

risks,�and�countermeasures

1� �Constantly�examine�the�most�appropriate�structure�

for�the�Board�of�Directors

2� �Continually�assess�the�meeting�agenda�based�on�

matters�such�as�current�companywide�initiatives　

(themes)�and�market�trends

3� �Reevaluate�deliberation�method�including��

opportunities�for�free�discussion

4� �Revise�the�management�of�the�advisory�

committee

*��◎ :�Committee�chair�for�the�respective�advisory�committees

Directors and Audit & Supervisory Board Members

History�of�the�Governance�System

� 1994� 2002� 2003� 2004� 2005� 2006� 2007� 2012� 2013� 2014� 2015� 2016� 2017� 2018

Separation of Management and Execution

External Directors

External Audit & Supervisory Board Members*

Advisory Bodies to the Board of Directors

Corporate Governance and Internal Control Principles

*��The�number�of�External�Audit�&�Supervisory�Board�Members�(number�appointed�/�upper�limit�according�to�the�Articles�of�Incorporation),�was�temporarily�4/7�and��

is�currently�3/5.

Reduced�the�number�of�directors�to�a�number�that�can�participate�in�deliberations,�introduced�the�Managing�Officer�System

1

1

2

Governance�Committee

Nomination�Committee

Remuneration�Committee

3

34

5



The�Board�of�Directors�is�the�highest�authority�for�execution�of�business�and�supervision,�and�in�order�to�secure�this�function,��

the�Company�has�limited�the�number�of�Directors�to�the�maximum�to�enable�substantial�discussions�and�gives�priority�to�the��

appointment�of�new�External�Directors�in�the�case�of�increasing�the�number�of�board�members�in�order�to�enhance�the�division��

of�roles�between�management�oversight�and�execution.�In�addition,�the�Company�has�established�the�Governance�Committee,�the�

Nomination�Committee,�and�the�Remuneration�Committee�to�serve�as�advisory�bodies�to�the�Board�of�Directors.�These�committees�

comprise�mainly�external�members.

� At�Board�of�Directors’�meetings,�matters�that�are�deliberated�or�reported�on�abide�by�the�Company’s�internal�regulations.�In�addition�

to�matters�concerning�fundamental�policies�related�to�management,�important�business�execution�and�matters�authorized�by�

resolutions�of�the�General�Meeting�of�Shareholders,�the�Company�passes�resolutions�on�matters�determined�by�law�and�company�

statute.�We�also�receive�reports�regarding�matters�determined�by�law�and�the�status�of�important�business�operations.

� Regular�meetings�of�the�Board�of�Directors�are�held�once�every�month�in�principle�and�extraordinary�meetings�are�held�from�time�

to�time�at�any�time�if�deemed�necessary.

Board of Directors

In�structuring�the�corporate�governance�framework,�the�Company�places�emphasis�on�“improved�transparency�and�accountability”�

and�“the�clarification�of�the�division�of�roles�between�the�oversight�activities�and�the�executive�activities�of�management.”�For��

“improved�transparency�and�accountability,”�the�Company�ensures�sound�supervision�and�monitoring�of�management�with�the�

viewpoints�of�External�Directors�and�External�Audit�&�Supervisory�Board�Members.�The�Company�has�also�established�an�internal�

control�system�for�disclosure�so�that�all�executives�and�employees�fulfill�their�accountability�to�stakeholders�under�the�principle�of�fair�

disclosure.�For�“the�clarification�of�the�division�of�roles�between�the�oversight�activities�and�the�executive�activities�of�management,”�

the�Company�delegates�execution�of�business�to�Managing�Officers�substantially�while�the�Board�of�Directors�retains�a�supervisory�

role�over�Managing�Officers’�business�activities.�Chief�Operating�Officers�of�the�16�Headquarter�Business�Units�and�the�3�Overseas�

Regional�Business�Units�serve�concurrently�as�Managing�Officers�and�engage�in�business�operations�for�the�consolidated�Group�in��

a�responsive�and�flexible�manner.�

� While�increasing�the�effectiveness�of�supervisory�functions�by�having�Audit�&�Supervisory�Board�Members,�the�Company�imple-

ments�corporate�governance�by�maintaining�an�Audit�&�Supervisory�Board�system�because�it�believes�that�having�internal�Directors�

who�are�familiar�with�its�business�practices�and�operations�is�essential�to�the�business�of�a�general�trading�company.�By�adopting�a�

Committee�System�in�which�External�Directors�and�External�Audit�&�Supervisory�Board�Members�participate,�the�Company�achieves�

highly�effective�corporate�governance�to�secure�“improved�transparency�and�accountability”�and�“the�clarification�of�the�division�of�

roles�between�the�oversight�activities�and�the�executive�activities�of�management.”

Basic View on Corporate Governance

The�Audit�&�Supervisory�Board�Members�supervise�the�Directors’�execution�of�duties�as�an�independent�institution�with�the�mandate�of�

the�shareholders.�For�this�purpose,�Audit�&�Supervisory�Board�Members�carry�out�multifaceted,�effective�audit�activities�such�as�attend-

ing�important�internal�meetings,�verifying�reports�and�investigating�our�business,�and�take�necessary�measures�in�a�timely�manner.

� Audit�&�Supervisory�Board�meetings�are�held�periodically�and�precede�meetings�of�the�Board�of�Directors.�Moreover,�additional�

meetings�are�held�on�an�as-needed�basis.�The�Audit�&�Supervisory�Board�Members�attend�meetings�of�the�Board�of�Directors�to�

monitor�how�the�proceedings�of�the�meetings�are�managed�and�the�content�of�the�decisions�made.�These�members�also�actively�

express�their�opinions.

� Auditing�by�the�Audit�&�Supervisory�Board�Members�covers�a�variety�of�areas,�among�which�are�execution�of�duties�by�Directors,�

decision-making�processes�at�the�meetings�of�the�Board�of�Directors�and�others,�status�of�construction�and�operation�of�the�internal�

control�system,�independence�of�the�Independent�Auditors,�system�of�financial�reporting,�accounting�policies�and�processing�of�

financial�information,�audit�of�financial�statements,�reports�from�the�Independent�Auditors,�and�the�system�of�disclosure.

Audit & Supervisory Board


Evaluation of the Effectiveness of the Board of DirectorsDuring the fiscal year ended March 31, 2017, the Company carried out questionnaires regarding the effectiveness of the Board

of Directors. Based on the results of these questionnaires, the Board of Directors and its secretariat implemented the following

initiatives in the fiscal year ended March 31, 2018, to further improve Board effectiveness.

Evaluation of the Effectiveness of the Board of Directors for the Fiscal Year Ended March 31, 2018

In�light�of�the�results�of�the�questionnaires,�the�resolution�was�passed�at�a�Board�of�Directors’�meeting�held�in�March�2018�after�

discussions�were�held�at�an�External�Members�Meeting�and�at�meetings�of�the�Governance�Committee,�which�took�place�in�

February�2018.

Recognition of issues

based on evaluation

results carried out on

March 31, 2017

InitiativesEvaluations of questionnaire

carried out on March 31, 2018

Composition�of�the�


During�the�fiscal�year�ended�March�31,�2018,�the�Company�achieved�

improvements�with�respect�to�striking�a�balance�in�diversifying�the�

composition�of�its�Board�of�Directors,�having�appointed�Director�Walsh,�

who�has�experience�being�the�CEO�of�a�global�corporation,�and�Audit�&�

Supervisory�Board�Member�Mori,�who�has�expertise�in�accounting�and�

auditing.

A�significant�majority�of�the�external�

members�responding�to�the�2018�question-

naire�provided�favorable�assessment�

concerning�the�composition�of�the�Board�of�

Directors,�and�a�majority�of�the�respondents�

overall�feel�the�situation�has�improved�in�

comparison�with�the�previous�year.

Discussion�topics During�the�fiscal�year�ended�March�31,�2018,�the�Board�of�Directors�

engaged�in�deliberations�regarding�business�plans�for�the�fiscal�year,�

given�the�notion�that�more�opportunities�should�be�arranged�for�discuss-

ing�Mitsui’s�overall�direction�on�matters�such�as�corporate�strategy�and�the�

medium-term�management�plan.�The�Board�of�Directors�also�engaged�in�

deliberations�with�respect�to�the�new�medium-term�management�plan,�

subsequent�to�deliberations�of�the�External�Member�Meetings.�Moreover,�

at�External�Member�Meetings,�opportunities�were�arranged�to�discuss�

topics�that�included�“matters�of�concern�regarding�the�capital�market�and�

the�Company’s�IR�activities”�and�“Mitsui’s�digital�transformation.”



naire�provided�favorable�assessment�

concerning�the�matter�of�discussions�

regarding�Mitsui’s�overall�direction��

at�meetings�of�the�Board�of�Directors,�and�a�

majority�of�the�respondents�overall�feel�the�

situation�has�improved�in�comparison�with�

the�previous�year.

Operation�of�the�

Board�meetings

With�respect�to�matters�that�are�to�be�referred�and�reported�to�the�Board�

of�Directors,�beginning�in�the�fiscal�year�ended�March�31,�2018,�materials�

for�meetings�of�the�Board�of�Directors�now�clearly�state�points�that�are�to�

be�discussed�up�to�the�stage�of�referral�and�reporting�to�the�Board�of�

Directors,�including�bodies�such�as�the�Council�on�Individual�Proposals�

and�the�Corporate�Management�Committee.�The�materials�for�meetings�

of�the�Board�of�Directors�now�contain�content�that�is�appropriate�with�

respect�to�deliberating�on�such�points,�and�tables�listing�major�points�of�

discussion,�risks,�and�countermeasures�in�that�regard.



naire�provided�a�favorable�assessment�

concerning�the�notion�that�there�is�greater�

clarity�with�respect�to�points�of�internal�

Company�discussion,�which�have�been��

the�basis�of�discussions�of�the�Board�of�

Directors,�and�a�majority�of�the�respondents�

overall�feel�the�situation�has�improved�in�

comparison�with�the�previous�year.

QuestionnaireFurther plans to

enhance governanceSummary of evaluation results

① Composition:��

Make�continuous�effort�to�manage�the�

organizational�structure�according�to�

corporate�governance�policies�in�order��

to�maintain�Board�effectiveness

② Considerations:��

Continually�assess�the�meeting�agenda�

based�on�matters�such�as�current�

companywide�initiatives�(themes)��

and�market�trends

③ Method of deliberation:��

Reevaluate�deliberation�method�

including�opportunities�for�free�

discussions

④ Advisory committees:��

Periodically�report�discussion�content,�

increase�frequency�of�meetings,�revise�

the�management�of�the�advisory�

committees

①�Many�commented�that�improvement�has�been�achieved�in�addressing�

the�three�challenges�stated�last�year�with�respect�to�(1)�composition�of�the�

Board�of�Directors,�(2)�discussion�topics,�and�(3)�revamping�meeting�

management.

②�Meetings�of�the�Board�of�Directors�have�been�operating�smoothly,�

underpinned�by�adequate�support�of�the�Board�of�Directors�Secretariat�in�

areas�such�as�preparing�materials�for�meetings�of�the�Board�of�Directors,�

providing�information,�and�scheduling.

③�The�Board�of�Directors�has�been�securing�sufficient�time�for�deliberations�

and�engaging�in�constructive�discussions�and�exchanges�of�opinion.

④�At�meetings�of�the�Board�of�Directors,�reports�are�given�on�results�of�risk�

analysis�from�Companywide�and�multiple�angles,�based�on�which�the�

Board�of�Directors�discusses�and�reviews�such�risks�drawing�on�knowledge�

furnished�by�respective�Directors�and�Audit�&�Supervisory�Board�Members.

⑤�The�respective�Directors�and�Audit�&�Supervisory�Board�Members,�upon�

understanding�the�Board�of�Directors’�duty�to�carry�out�oversight�and�

auditing�of�management,�have�all�been�devoting�sufficient�time�and�effort�

in�fulfilling�their�responsibilities�as�Directors�or�Audit�&�Supervisory�Board�

Members�from�an�objective�standpoint�separate�from�business�execution.

⑥�The�Company�adequately�ensures�the�availability�of�opportunities�and�

funds�for�enabling�Directors�and�Audit�&�Supervisory�Board�Members�to�

acquire�knowledge�necessary�to�fulfill�their�roles�and�duties,�and�also�on�

the�whole�the�Company�has�ensured�availability�of�frameworks�for�

collaboration�involving�external�members,�management,�the�Independent�

Auditor,�and�the�Internal�Auditing�Division.

Carried�out�in��

January�2018�

14�directors,��

5�outside�directors

Each�question�had�five�grades�

that�could�be�assigned�and�

room�was�available�for�year-

on-year�evaluations�and�

comments.

With�respect�to�carrying��

out�the�above�evaluation�

method,�at�a�Governance�

Committee�meeting�held�in�

November�2017,�the�decision�

was�made,�as�the�current�

format’s�effectiveness�was�

recognized,�to�persist�with�

the�current�self-evaluation�

format�involving�the�

evaluation�of�effectiveness�of�

the�Board�of�Directors�for�the�

fiscal�year�ended�March�31,�

2018,�upon�having�verified�

the�adequacy�of�processes�

that�encompass�methods�of�

evaluating�the�effectiveness�

of�the�Board�of�Directors�

carried�out�by�a�third�party.

Based�on�the�details�summarized�above,�the�Company’s�Board�of�

Directors�concludes�that�it�has�adequately�maintained�its�effectiveness�

during�the�fiscal�year�ended�March�31,�2018.



Stock�option�scheme�as�stock-based��

compensation�with�stock�price�conditions

Stock�option

(Upper�limit�of�total�amount�paid:�¥500�million�per�year)

Performance-related��

bonuses��

(Upper�limit�of�total�amount�paid:�¥700�million�per�year)

Fixed�basic�

remuneration

(Upper�limit�of�total�amount�paid:�¥1,000�million�per�year)

Performance-related�bonus�based�on��

profit�and�core�operating�cash�flow

Fixed�basic�remuneration

Required�to�purchase�the�Company’s�shares�in�

an�amount�equivalent�to�at�least�10%�of�his�or�

her�fixed�basic�remuneration

Structure�of�Remuneration

Incentive�for�medium�

and�long�term

Incentive�for��

short�term

For�Directors

For�External�Directors

and�Audit�&�Supervisory��

Board�Members�

(Upper�limit�of�total�amount�paid:�

¥240�million�per�year)

Purchasing�share

Remuneration of Directors

Taking�into�consideration�the�result�of�the�deliberation�at�the�

Remuneration�Committee,�which�is�chaired�by�an�External�

Director,�the�remuneration�of�Directors�(excluding�External�

Directors)�is�determined�as�the�sum�of�fixed�basic�remunera-

tion,�performance-related�bonuses�based�on�important�KPI�set�

by�management�and�stock-based�compensation�stock�options�

with�stock�price�conditions�as�medium�and�long-term�incentive�

compensation�and�limited�to�within�the�amounts�resolved�at�

the�General�Meetings�of�Shareholders.�Retirement�compensa-

tion�is�not�paid�to�Directors.

•��The�performance-related�bonuses�paid�to�directors�are�

calculated�based�on�the�following�formula,�which�has�been�

deemed�appropriate�by�the�Remuneration�Committee�and�

subsequently�approved�by�the�Board�of�Directors.�

Total�payment�amount�=�(consolidated�profit�for�the�year�

[attributable�to�owners�of�the�parent]�×�50%�×�0.1%)�+�(core�

operating�cash�flow�×�50%�×�0.1%)

The�upper�limit�for�the�total�amount�is�set�at�¥700�million�and�

individual�payment�amounts�are�proportionally�distributed�

based�on�a�point�system�determined�by�director�position.�In�the�

event�that�consolidated�profit�for�the�year�(attributable�to�

owners�of�the�parent)�is�negative,�i.e.,�a�loss,�or�if�the�core�

operating�cash�flow�is�negative,�i.e.,�a�net�cash�outflow,�the�

items�are�calculated�as�zero.

•��The�stock�option�scheme�is�granted�to�directors�in�order�to�

have�them�share�the�benefits�and�risks�of�stock�price�fluctua-

tions�with�the�Company’s�shareholders�and�to�give�them�

greater�incentive�to�make�contributions�to�improvements�in�

medium-�and�long-term�business�performance�and�corporate�

value.�Under�the�stock�option�scheme,�subscription�rights�to�

shares,�up�to�annual�amounts�of�¥500�million�and�500,000�

shares,�are�assigned�to�all�Directors.�The�period�for�the�right�to�

exercise�subscription�rights�to�shares�is�27�years�from�the�day�

following�the�passage�of�three�years�from�the�allotment�date.�

The�exercise�price�is�set�at�¥1.�In�the�case�eligible�recipients�

lose�their�Director�and/or�Managing�Officer,�and/or�Audit�&�

Supervisory�Board�Member�status,�and�10�years�pass�from�the�

following�day�of�such�forfeiture,�they�are�no�longer�able�to�

exercise�their�subscription�rights�to�shares.

•��Each�Director�(excluding�External�Directors)�is�required�to�

purchase�the�Company’s�shares�in�an�amount�equivalent�to�at�

least�10%�of�his�or�her�monthly�remuneration�but�less�than�¥1�

mil�lion�through�the�Mitsui�Executives’�Shareholding�Association.

� The�remuneration�for�External�Directors�is�limited�to�a�fixed�

remuneration�that�does�not�include�a�performance-related�

portion,�and�there�is�no�obligation�of�share�purchasing�for�the�

External�Directors.

Remuneration of Audit & Supervisory Board Members

Remuneration�of�the�Audit�&�Supervisory�Board�Members�is�

determined�through�deliberation�among�the�Audit�&�Supervi-

sory�Board�Members,�the�total�of�which�should�not�exceed�the�

amount�determined�at�the�General�Meeting�of�Shareholders.�

Audit�&�Supervisory�Board�Members�receive�only�monthly�fixed�

remuneration,�which�is�not�related�to�the�performance�of�

Mitsui.�Retirement�compensation�is�not�paid�to�the�Audit�&�

Supervisory�Board�Members.

Remuneration of Directors and Audit & Supervisory Board Members

Remuneration�of�directors�and�Audit�&�Supervisory�Board�

Members�in�the�fiscal�year�ended�March�31,�2018

Category�of�PositionNumber�of�Recipients*1

(¥�million)

Basic�Remuneration Bonus

Stock��Option

Total�Remuneration*2

Directors

(Excluding�External�

Directors) 11 733 542 129 1,405

Audit�&�Supervisory�

Board�Members

(Excluding�External�

Audit�&�Supervisory�

Board�Members) 2 132 — — 132

External�Directors�

and�External�Audit�&�

Supervisory�Board�

Members 10 151 — — 151

Total 23 1,016 542 129 1,688

*1.��The�above�includes�Directors�and�Audit�&�Supervisory�Board�Members�who�

retired�from�office�in�the�fiscal�year�to�March�2018.

*2.��In�addition�to�the�above�amounts,�a�total�of�¥559�million�was�paid�to�119�

retired�Directors,�and�¥62�million�to�17�retired�Audit�&�Supervisory�Board�

Members,�as�pensions�(representing�payments�determined�prior�to�the�

abolition�of�those�systems).


External Directors / External Audit & Supervisory Board Members

Reasons for Appointing Each External Director / Major Activities in the Fiscal Year Ended March 31, 2018

NameIndependent�

Director*Reasons�for�Appointment

Attendance�at��

Meetings�in�FY2018�

(Number�of�Meetings�

Attended�/�Total�

Number�of�Meetings)

Significant�Concurrent�Positions��

(As�of�June�21,�2018)

Toshiro

Muto

〇 Mr.�Muto�has�deep�insight�into�fiscal�and�monetary�affairs,�as�well�as�in��

economics�in�general,�gained�at�the�Ministry�of�Finance�and�the�Bank�of�

Japan.�At�the�Board�of�Directors’�meetings,�he�uses�his�specialist�knowledge��

to�speak�out�actively,�making�a�significant�contribution�to�deepening�the�

discussion.�In�the�fiscal�year�ended�March�31,�2018,�he�served�as�the��

committee�chair�of�the�Remuneration�Committee�and�a�member�of�the�

Governance�Committee,�contributing�to�the�study,�revision�and�so�forth�of�

the�remuneration�system�for�Directors,�which�helped�to�further�strengthen�

Mitsui’s�corporate�governance.�The�Company�has�reappointed�him�as�an�

External�Director�so�that�he�may�continue�to�advise�and�supervise�its�

management.

(13/15) Chairman,�Daiwa�Institute��

of�Research�Ltd.

CEO�(Chief�Executive�

Officer)�and�Director�

General,�the�Tokyo�

Organising�Committee��

of�the�Olympic�and�

Paralympic�Games

Izumi

Kobayashi

〇 Ms.�Kobayashi�has�advanced�expertise�in�organizational�management�and�

risk�management�for�generating�innovation,�which�she�has�accumulated�

through�her�experience�working�as�the�representative�of�private�sector��

financial�institutions�and�a�multilateral�development�bank.�She�speaks��

out�actively�from�diverse�perspectives�at�the�Board�of�Directors’�meetings,�

making�a�significant�contribution�to�deepening�the�discussion.�During�the�

fiscal�year�ended�March�31,�2018,�Ms.�Kobayashi�served�as�a�member�of�the�

Remuneration�Committee�and�exercised�strong�leadership�as�chair�of�the�

Nomination�Committee�in�examining�the�composition�of�the�Board�of�

Directors,�the�selection�process�for�Directors�and�Managing�Officers,�and�

related�matters.�In�view�of�these�points,�the�Company�has�reappointed�her��

as�an�External�Director�so�that�she�may�continue�to�advise�and�supervise�

�its�management.

(15/15) External�Director,��

ANA�HOLDINGS�INC.

Governor,��

Japan�Broadcasting�

Corporation�

External�Director,�

Mizuho�Financial�Group,�

Inc.

Jenifer

Rogers

〇 Ms.�Rogers�has�a�global�perspective�and�advanced�expertise�in�risk��

management�cultivated�through�her�experience�working�for�international�

financial�institutions�and�her�experience�in�legal�work�as�in-house�counsel.�

She�makes�many�useful�comments�concerning�risk�control�at�the�Board�of�

Directors’�meetings,�making�a�significant�contribution�to�enhancing�the�

supervisory�function�of�the�Board�of�Directors.�Since�the�fiscal�year�ended�

March�31,�2016,�she�has�served�as�a�member�of�the�Governance�Committee,�

actively�stating�her�opinions�on�the�building�of�a�highly�transparent��

governance�system.�In�view�of�these�points,�the�Company�has�reappointed�

her�as�an�External�Director�so�that�she�may�continue�to�advise�and�supervise�

its�management.

(15/15) General�Counsel�Asia,��

Asurion�Japan�Holdings�G.K.

Hirotaka

Takeuchi

〇 Mr.�Takeuchi�has�deep�insight�related�to�management�gained�as�an�expert��

in�international�corporate�strategy.�At�the�Board�of�Directors’�meetings,�he�

makes�thought-provoking�proposals�on�Mitsui’s�management�strategies,�

making�a�significant�contribution�to�enhancing�the�supervisory�function��

of�the�Board�of�Directors.�Since�the�fiscal�year�ended�March�31,�2017,�he��

has�served�as�a�member�of�the�Nomination�Committee,�helping�to�improve�

the�transparency�of�the�Company’s�officers’�nominations.�The�Company�has�

reappointed�him�as�an�External�Director�so�that�he�may�continue�to�advise�

and�supervise�its�management.

(14/15) Professor�Emeritus,��

Hitotsubashi�University�

Professor,��

Harvard�Business�School�

External�Director,��

Daiwa�Securities�Group�Inc.�


BrightPath�Biotherapeutics�

Co.,�Ltd.

Samuel

Walsh

〇 Mr.�Walsh�has�global�expertise�and�excellent�management�skills�cultivated�

through�his�long�years�working�in�upper�management�within�the�automo-

tive�industry�and�as�chief�executive�officer�of�an�international�mining�and�

resources�company.�At�the�Board�of�Directors’�meetings,�he�makes�proposals�

and�suggestions�from�a�broad-minded�standpoint�based�on�his�experience�

of�managing�a�global�company,�and�makes�significant�contributions�to�active�

discussions�at�the�meetings�of�the�Board�of�Directors,�and�to�improving�the�

effectiveness�of�said�meetings.�During�the�fiscal�year�ended�March�31,�2018,�

Mr.�Walsh�served�as�a�member�of�the�Governance�Committee�and�actively�

provided�his�opinions�on�building�of�a�highly�transparent�governance�

system.�The�Company�has�selected�him�as�an�External�Director�so�that�he�

may�continue�to�advise�and�supervise�its�management.

(11/11)

(Since�his�

appointment�in�

June�2017)

―

*��An�External�Director�who�is�unlikely�to�have�conflicts�of�interest�with�general�shareholders,�as�stipulated�by�the�stock�exchange

Selection Criteria

External Directors

•� �The�prospective�person’s�extensive�business�experience�and�knowledge�are�required�to�deliberate�and�knowledge�of�his�or�her��

particular�area�of�business�should�be�used.

•� �The�Company�puts�great�value�on�ensuring�independence�of�External�Directors�from�Mitsui�in�the�pursuit�of�their�management�

oversight�functions.

•� �With�a�view�to�overseeing�business�operations�in�a�way�that�reflects�the�perspectives�of�our�diverse�stakeholders,�Mitsui�shall�take�into�

consideration�the�fields�from�which�candidates�originate,�along�with�their�gender.



Reasons for Appointing Each External Audit & Supervisory Board Member / Major Activities in the Fiscal Year Ended March 31, 2018

Name

Independent�

Audit�&�

Supervisory�

Board�

Member*

Reasons�for�Appointment

Attendance�at�Meetings�

in�FY2018�(Number�of�

Meetings�Attended�/�

Total�Number�of�

Meetings)

Significant�Concurrent�Positions�

(As�of�June�21,�2018)

Haruka

Matsuyama

〇 Ms.�Matsuyama�is�appointed�as�an�External�Audit�&�Supervisory�

Board�Member�in�expectation�of�the�expression�of�her�objective�

audit�opinions�from�an�independent�and�neutral�standpoint,�

with�advanced�insight�into�corporate�governance�and�risk�

management�cultivated�through�her�many�years�of�experience�

in�legal�affairs�as�a�judge�and�as�an�attorney�at�law.

Meetings�of�Board�

of�Directors�

(15/15)

Meetings�of�Audit�&�


(21/21)

Attorney�at�law


T&D�Holdings,�Inc.

External�Director,�Mitsubishi�

UFJ�Financial�Group,�Inc.


VITEC�HOLDINGS�CO.,�LTD.

Hiroshi

Ozu

〇 Mr.�Ozu�is�appointed�as�an�External�Audit�&�Supervisory�Board�

Member�in�expectation�of�the�expression�of�his�objective�audit�

opinions�from�an�independent�and�neutral�standpoint,�from�the�

many�years�of�experience�and�perspective�he�has�gained,�mainly�

as�a�prosecutor.


of�Directors�

(15/15)



(21/21)

Attorney�at�law

External�Audit�&�Supervisory�

Board�Member,�TOYOTA�

MOTOR�CORPORATION


Board�Member,��

Shiseido�Company,�Limited

Kimitaka

Mori

〇 Mr.�Mori�is�appointed�as�an�External�Audit�&�Supervisory�Board�

Member�because�the�Company�deems�him�capable�of�clearly�

expressing�an�opinion�as�External�Audit�&�Supervisory�Board�

Member�from�a�neutral�and�objective�perspective�based�on�his�

advanced�expertise�in�corporate�accounting�cultivated�through�

his�many�years�of�experience�as�a�certified�public�accountant.


of�Directors�

(10/11)



(15/16)

(Appointed�in��

June�2017)

Certified�public�accountant�


Japan�Exchange�Group,�Inc.


Board�Member,�East�Japan�

Railway�Company

External�Director,�Sumitomo�

Life�Insurance�Company

*��An�External�Audit�&�Supervisory�Board�Member�who�is�unlikely�to�have�conflicts�of�interest�with�general�shareholders,�as�stipulated�by�the�stock�exchange

External Audit & Supervisory Board Members

The�External�Audit�&�Supervisory�Board�Members�shall�be�selected�with�the�objective�of�further�heightening�the�neutrality�and�inde-

pendence�of�the�auditing�system,�and,�in�particular,�it�is�expected�that�the�External�Audit�&�Supervisory�Board�Members�will�give�an�

objective�voice�to�their�auditing�opinions�from�the�standpoint�of�neutrality,�building�on�such�factors�as�independence.�When�selecting�

candidates�for�External�Audit�&�Supervisory�Board�Members,�the�Audit�&�Supervisory�Board�shall�confirm�that�no�issues�with�indepen-

dence�arise�by�taking�into�consideration�such�factors�as�relations�with�the�Company,�management�and�important�staff�members.

Criteria for Independence of External Officers

(Directors/Audit & Supervisory Board Members)

External�Directors�or�External�Audit�&�Supervisory�Board��

Members�of�the�Company�who�do�not�fall�under�any�of�the�

following�items�are�to�be�judged�to�have�independence.

(1)� �Person�who�is�currently�or�was�in�the�past�10�years�an�

executive�director,�executive�officer,�managing�officer,�

manager,�employee,�administrative�officer,�etc.�(hereinaf-

ter�referred�to�as�“executing�person”)�of�the�Company�or�its�

consolidated�subsidiaries

(2)� �Person�or�the�executing�person�of�a�corporation�holding�

either�directly�or�indirectly�10%�or�more�of�the�total�

number�of�the�voting�rights�of�the�Company

(3)� �Person�whose�major�business�partner�is�the�Company�or�

its�consolidated�subsidiaries*1�or�the�executing�person�of��

the�same

(4)� �Major�business�partner�of�the�Company�or�its�consolidated�

subsidiary*2�or�the�executing�person�of�the�same

(5)� �Independent�auditor�of�the�Company�or�its�consolidated�

subsidiary�or�employee,�etc.�of�the�same

(6)� �Person�providing�professional�services�such�as�consultant,�

lawyer�and�certified�public�accountant�who�received�from�

the�Company�monetary�payment�or�other�property��

benefits�exceeding�¥10�million�in�total�other�than�officer�

remuneration�in�the�most�recent�fiscal�year�(referring�to�

the�person�belonging�to�the�organization�if�the�one�who�

received�the�relevant�property�is�an�organization�such�as�

corporation�and�association)

(7)� �Person�or�the�executing�person�of�a�corporation�who�

received�the�annual�total�of�¥10�million�or�more�of�dona-

tions�or�aid�funds�from�the�Company�or�its�consolidated�

subsidiary�in�the�most�recent�fiscal�year

(8)� �Person�who�has�fallen�under�any�of�(2)�to�(7)�above�in��

the�past�three�years

(9)� �Spouse�or�relative�within�the�second�degree�of�kinship�

(hereinafter�referred�to�as�“close�relatives”)�of�the�person�

who�is�currently�or�has�been�recently�the�important��

executing�person�of�the�Company�or�its�consolidated�

subsidiary�(including�director�who�is�not�the�executing�

person�in�the�case�of�External�Audit�&�Supervisory��

Board�Member)

(10)��Close�relatives�of�the�person�who�currently�falls�or�has�

fallen�recently�under�any�of�(2)�to�(7)�above�(excluding��

the�one�who�is�not�important)

*1.��If�the�relevant�business�partner�received�from�the�Company�or�its�consolidated�

subsidiary�the�payment�equivalent�to�5%�or�more�of�its�annual�transaction�

volume�(non-consolidated)�in�the�most�recent�fiscal�year�or�the�relevant�

business�partner�obtained�from�the�Company�or�its�consolidated�subsidiary�

the�money�loans�equivalent�to�5%�or�more�of�its�consolidated�total�assets�in�

the�most�recent�fiscal�year,�the�relevant�business�partner�is�deemed�to�be�the�

person�whose�major�business�partner�is�the�Company�or�its�consolidated�

subsidiary.

*2.��If�the�Company�or�its�consolidated�subsidiary�received�from�the�relevant�

business�partner�the�payment�equivalent�to�2%�or�more�of�Mitsui’s�annual�

consolidated�transaction�volume�in�the�most�recent�fiscal�year�or�the�relevant�

business�partner�provided�the�Company�or�its�consolidated�subsidiary�with�

the�money�loans�equivalent�to�2%�or�more�of�Mitsui’s�consolidated�total�

assets,�the�relevant�business�partner�is�deemed�to�be�the�major�business�

partner�of�the�Company�or�its�consolidated�subsidiary.


The�Company�appoints�certified�public�accountants�belonging�

to�Deloitte�Touche�Tohmatsu�LLC�as�Independent�Auditors�to�

carry�out�auditing�under�the�Companies�Act�of�Japan�and�the�

Financial�Instruments�and�Exchange�Act�of�Japan�as�well�as�

auditing�of�consolidated�financial�statements�in�English.�To�

secure�prompt�financial�closing�and�reliability,�the�auditing�

work�of�the�Company�and�its�consolidated�subsidiaries�is�in�

principle�entrusted�solely�to�Deloitte�Touche�Tohmatsu,�which�

belongs�to�the�same�network�as�Deloitte�Touche�Tohmatsu�LLC.

Independent Auditors

When�holding�listed�shares�for�any�purposes�other�than�purely�

for�investment�returns,�the�Company�holds�such�listed�shares�

only�in�the�case�where�it�is�judged�to�be�reasonable�after�strict�

and�comprehensive�examination�of�several�factors,�including�

the�necessity�for�maintaining�or�strengthening�relationships�

with�the�investee,�medium-�to�long-term�economic�rationale,�

and�future�outlook.�With�respect�to�the�Group’s�asset�portfolio�

that�includes�listed�shares,�Mitsui�reviews�the�significance�of�

holding�such�assets�every�year�in�light�of�medium-�to�long-term�

economic�rationale�and�future�outlook,�and�reports�said�

significance�to�the�Board�of�Directors.�With�respect�to�exercising�

voting�rights�for�listed�shares�held�by�the�Group,�deliberation�is�

conducted�on�a�case-by-case�basis�as�to�whether�or�not�a�

proposal�should�be�approved�by�comprehensively�taking�into�

consideration�any�impact�that�the�relevant�proposal�may�have�

on�corporate�value�of�the�investee.

Policy Related to Acquisition and Holding of Listed Shares

Upon�assumption,�opportunities�are�given�to�Directors�and�

Audit�&�Supervisory�Board�Members�for�gaining�full�understand-

ing�of�the�business,�financial�affairs,�organization,�etc.,�of�Mitsui,�

the�Companies�Act�of�Japan�and�related�laws�and�regulations,�

corporate�governance�and�internal�control�to�ensure�that�they�

may�fulfill�their�duties�including�the�respective�roles�expected�of�

Directors�or�Audit�&�Supervisory�Board�Members,�which�are�

mandated�by�the�shareholders�(fiduciary�responsibility)�and�

each�legal�responsibility.�Furthermore,�opportunities�are�given�

for�keeping�them�up�to�date�as�necessary.

Policy on Training for Directors and Audit & Supervisory Board Members

Support Systems

For�External�Directors,�before�regular�and�extraordinary�meet-

ings�of�the�Board�of�Directors,�materials�on�the�proposals�are�

provided�and�advance�explanations�are�given.�For�External�

Audit�&�Supervisory�Board�Members,�in�addition�to�the�timely�

provision�of�corporate�information�by�the�Full-time�Audit�&�

Supervisory�Board�Members�and�staff�in�the�Audit�&�Supervi-

sory�Board�Member�Division,�the�essence�of�the�meetings�

between�Full-time�Audit�&�Supervisory�Board�Members�and��

the�Audit�&�Supervisory�Board�Member�Division�is�provided�

periodically.�When�necessary,�advance�distribution�of�materials�

and�advance�explanations�are�conducted�regarding�regular�and�

extraordinary�meetings�of�the�Audit�&�Supervisory�Board�and�of�

the�Board�of�Directors.�The�Company�provides�its�External�

Directors�and�External�Audit�&�Supervisory�Board�Members�with�

specialized�personal�computers�and�distributes�materials�for�

meetings�of�the�Board�of�Directors�in�a�timely�manner�via�

e-mail.�In�doing�so,�the�Company�ensures�that�the�external�

members�have�sufficient�time�to�review�agenda�items.�At�the�

same�time,�the�Company�has�set�up�a�database�for�storing�

information,�such�as�meeting�minutes�and�other�materials�

from�past�meetings�of�the�Board�of�Directors,�and�the�external�

members�can�access�this�database�using�their�specialized�

personal�computers.

External Members Meetings

The�meeting�composed�of�all�External�Directors�and�External�

Audit�&�Supervisory�Board�Members�is�held�periodically,�for�the�

purpose�of�exchanging�information�and�opinions�regarding�

important�matters�in�management�among�External�Directors,�

or�among�External�Directors�and/or�Internal�Directors,�Audit�&�

Supervisory�Board�Members,�and�Managing�Officers.�The�

External�Members�Meetings�were�held�six�times�in�the�fiscal�

year�ended�March�31,�2018,�where�External�Directors,�External�

Audit�&�Supervisory�Board�Members,�Internal�Directors,��

Full-time�Audit�&�Supervisory�Board�Members,�Independent�

Auditors,�and�Managing�Officers�exchanged�information�and�

opinions�regarding�matters�such�as�the�corporate�management�

policy,�audits,�and�the�operation�of�operating�segments.�

Cooperation among External Directors and External

Audit & Supervisory Board Members in Audits,

Internal Audits, Corporate Audits, and Independent

Audits, as well as Their Relationship with Internal

Control Departments

External�Directors�and�External�Audit�&�Supervisory�Board�

Members,�through�the�Board�of�Directors�and�the�Audit�&�

Supervisory�Board,�mutually�coordinate�with�internal�audits,�

auditing�by�Audit�&�Supervisory�Board�Members�and�account-

ing�audits,�as�well�as�supervise�and�audit�the�internal�control�

system.�Specifically,�they�periodically�receive�reports�on�the�

following�at�meetings�of�the�Board�of�Directors�and�the�Audit�&�

Supervisory�Board,�respectively:�results�of�the�internal�audits�

and�internal�audit�plans,�results�of�auditing�by�the�Audit�&�

Supervisory�Board�and�audit�implementation�plans,�summary�

of�management�letters�by�Independent�Auditors,�assessment�

results�with�regard�to�the�internal�control�system�in�accordance�

with�the�Financial�Instruments�and�Exchange�Act�of�Japan,�the�

operational�status�of�compliance�programs,�and�other�matters�

regarding�the�structure�and�management�of�internal�controls.�

Furthermore,�at�External�Members�Meetings,�External�Directors,�

Corporate�Auditors,�and�Independent�Auditors�exchange�

opinions�and�information�on�auditing�policy.


� The�Board�of�Directors�oversees�the�design�of�Mitsui’s�internal�controls�and�assumes�the�role�and�responsibility�of�monitoring�

internal�control�establishment,�operation,�and�assessment.�Based�on�the�basic�design�of�internal�controls�provided�for�by�the�Board�of�

Directors,�Mitsui’s�management�assumes�the�role�and�responsibility�of�maintaining,�operating,�and�assessing�internal�controls.�In�

addition,�the�Internal�Auditing�Division,�which�is�under�the�direct�control�of�the�president,�verifies�the�suitability�and�status�of�internal�

control�design�based�on�plans�approved�by�Mitsui’s�management�and�from�an�independent�standpoint.

� The�Company�has�established�the�following�major�committees�pertaining�to�the�execution�of�business�and�implementation�of�

internal�controls,�and�is�taking�measures�to�respond�to�a�wide�range�of�risks�and�forms�of�businesses,�which�continue�to�increase��

and�diversify.

Internal�Controls�Committee

Portfolio�Management�Committee

Information�Strategy�Committee

Sustainability�Committee

Diversity�Promotion�Committee

Business�Innovation�Committee

Crisis�Management�Headquarters

Improvement�of�effectiveness�and�efficiency�of�operations;

Ensuring�compliance�with�generally�accepted�accounting�principles�and�the�reliability�of�financial�reporting;

Compliance�with�applicable�laws�and�regulations,�along�with�management�principles�and�in-house�rules�including�various�

codes�of�conduct�reflecting�management�principles�(hereafter�referred�to�as�“laws,�regulations�and�in-house�rules”);�and

Safeguarding�of�Company�assets.

Ultimate�responsibility�for�execution�of�business�operations�lies�with�the�President�and�Chief�Executive�Officer.�The�President�and�

Chief�Executive�Officer�delegates�authority�to�the�Chief�Operating�Officers�of�the�business�units�and�regional�business�units,�who,�in�

turn,�report�to�the�President�and�Chief�Executive�Officer.�The�Corporate�Management�Committee�is�organized�for�deliberating�the�

basic�policies�and�important�matters�relating�to�the�overall�management.�The�Committee�consists�of�the�Chairman�of�the�Board�of�

Directors,�President�and�Chief�Executive�Officer�(the�committee�chair),�the�Directors�in�charge�of�Corporate�Staff�Units,�and�Represen-

tative�Directors�or�Managing�Officers�nominated�by�the�President�and�Chief�Executive�Officer.�The�Corporate�Management�Committee�

is�held�weekly�in�principle.�Matters�referred�to�the�Corporate�Management�Committee�meeting�are�determined�by�the�President�and�

Chief�Executive�Officer,�taking�into�consideration�discussions�among�the�Committee�members.

� Mitsui�aims�to�achieve�the�four�objectives�listed�below�in�terms�of�internal�controls.�In�addition,�Mitsui�views�internal�controls�as�a�

“framework�for�management�to�control�and�supervise�its�business�execution�organization”�that�comprises�the�six�elements�of�control�

environment,�risk�assessment,�control�activities,�information�and�communication,�monitoring,�and�response�to�IT.

Execution�of�Business�Activities�and�Internal�Controls

1

2

3

4


Framework for Internal Controls and Execution of Business Activities

President�and�CEOInternal�Auditing�DivisionBusiness�Operating�Organization

(Inside�/�Outside�of�Japan)

Internal�Controls�Committee*1

Compliance�Committee

Disclosure�Committee

J-SOX�Committee

Corporate�Management�Committee

Exercise�necessary�decision�making�in�place�of�

normal�in-house�decision�mechanisms�relating�to�

all�conceivable�matters�requiring�an�extraordinary�

response

Chaired�by�the�President�and�Chief�Executive�

Officer,�establishes�basic�policy�related�to�the�

internal�control�system�while�developing,�

maintaining,�and�improving�the�effectiveness�

of�the�integrated�management�system

Deliberate�upon�basic�policies�and�important�

matters�for�the�execution�of�groupwide�

business�operations

Develop,�maintain�and�improve�the�

effectiveness�of�the�compliance�structure

Develop�principles�and�basic�policy�for�

statutory�disclosure�and�timely�disclo-

sure�as�well�as�the�internal�structure,�and�

discuss�and�determine�the�materiality�

and�appropriateness�of�information�to�

be�disclosed

Develop,�maintain�and�improve�the�

effectiveness�of�the�system�for�ensuring�

the�reliability�of�our�consolidated�finan-

cial�reporting

Portfolio�Management�Committee*2

Establish�corporate�portfolio�strategy�as�well�

as�investment�and�loan�plans,�monitor�our�

corporate�portfolios,�and�examine�important�

individual�proposals

Information�Strategy�Committee*2

Plan�companywide�information�strategy�and�

determine�and�monitor�essential�policies�

concerning�the�establishment�of�a�manage-

ment�platform�and�promotion�of�a�structure�

for�information�strategy

Business�Innovation�Committee*1

Monitor�and�analyze�new�technology�trends�

and�potential�business�innovations,�specify�

our�priorities�and�focuses,�and�provide�advice�

to�the�management�as�well�as�examine�

specific�measures�to�support�business�units�

in�implementing�potential�new�business,�

aiming�at�the�next�generation

Crisis�Management�Headquarters

Environmental�&��

Societal�Advisory�Committee

Environmental�Fund��

Deliberation�Committee

Sustainability�Committee*1

Plan,�design,�and�propose�a�management�

approach�that�focuses�on�sustainability�with�

regard�to�Mitsui�and�society�as�a�whole

Diversity�Promotion�Committee*2

Make�proposals�regarding�basic�policy�and�

the�plan�for�diversity�promotion,�and�formu-

late�and�implement�targets�set�along�with�

the�plan

*1.�Sub-committees�to�the�Corporate�Management�Committee

*2.�Advisory�bodies�to�the�Corporate�Management�Committee


Execution�of�Business�Activities�and�Internal�Controls

� Furthermore,�organizations�such�as�the�Portfolio�

Management�Committee,�the�Internal�Controls�Committee,��

the�Sustainability�Committee,�and�the�Crisis�Management�

Headquarters�establish�and�develop�risk�management�struc-

tures�on�a�companywide�basis�and�handle�significant�risks.�

Members�of�the�corporate�staff�of�each�committee�are�respon-

sible�for�surveillance�of�Mitsui’s�position�regarding�the�risks�

they�are�in�charge�of�overseeing,�as�well�as�the�control�of�risks�

within�the�prescribed�range�of�their�authority�and�the�provision�

of�support�to�relevant�directors�and�managing�officers.

Risks�arising�from�Mitsui’s�business�activities�are�monitored�and�

managed�by�chief�operating�officers�of�business�units�and�

regional�business�units�within�the�authorization�delegated�to�

them�from�Mitsui’s�management.�Measures�taken�by�each�

business�unit�to�manage�quantitative�risks�include�setting�

position�limits�and�loss-cut�limits�and�conducting�monitoring�

through�divisions�with�relevant�expertise.�For�the�management�

of�qualitative�risks,�the�business�units�are�obligated�to�observe�

relevant�internal�regulations.�When�a�business�unit�or�regional�

business�unit�takes�on�risks�that�are�greater�than�the�scope�of�

authority�granted�to�them,�it�is�necessary�to�obtain�approval�of�

the�Corporate�Management�Committee�or�a�relevant�represen-

tative�director�or�senior�managing�officer,�depending�on�the�

importance�of�the�situation,�in�accordance�with�the�standards�

of�the�internal�approval�system.

Risk Management

The�Company�implements�the�internal�controls�framework�as�

stipulated�in�the�Financial�Instruments�and�Exchange�Act�of�

Japan.�In�addition�to�companywide�discipline,�Mitsui�has�been�

conducting�self-assessment�by�units�subject�to�evaluation�and�

testing�by�an�independent�division�concerning�the�effective-

ness�of�accounting�and�financial�closing�controls,�IT�controls�

and�business�process�level�controls.

Internal Controls over Financial Reporting

The�Company�is�committed�to�complying�with�all�applicable�

laws,�rules�and�regulations�in�meeting�its�tax�compliance�and�

reporting�responsibilities,�whilst�simultaneously�managing�its�

global�tax�expenses.�The�Company�does�not�adopt�artificial�

arrangements�or�structures�for�the�purpose�of�tax�avoidance.

Global Tax Management Policy

The�Information�Strategy�Committee�establishes�important�

policies�related�to�Global�Group�information�strategy.�Further,�

the�committee�leads�Mitsui’s�efforts�to�build�and�operate�infor-

mation�systems,�develop�internal�rules�required�for�information�

security,�and�strengthen�the�management�of�risks�related�to�

information,�including�the�risk�of�information�leakage.�The�

committee�ensures�the�establishment�of�systems�to�control�risk�

associated�with�information�assets�appropriately.�Specifically,�it�

establishes�rules�for�process�of�procurement,�introduction�and�

operation�of�information�assets;�code�of�conduct�for�the�system�

supervisory�divisions�regarding�IT�security;�requirements�for�

information�risk�management�systems�and�the�basics�of��

information�management;�and�internal�rules�relating�to�the�

handling�of�personal�information�required�in�the�course�of�

business�operations�as�well�as�Cyber�Security�Countermeasures.

Internal Controls Related to Information Systems and Information Security


Mitsui�has�a�strong�belief�that�a�sound�reputation�is�the�founda-

tion�of�Mitsui’s�business.�At�Mitsui,�we�define�compliance�as�

complying�with�corporate�ethics�and�social�norms�in�addition�

to�laws,�regulations,�and�internal�rules�of�the�Company.�By�

word�“compliance”.�Mitsui�requires�its�employees�and�officers�to�

act�in�accordance�with�its�corporate�ethics,�based�on�its�man-

agement�philosophy�and�social�norms�in�addition�to�laws�and�

regulations�as�well�as�internal�rules�of�the�Company.�To�those�

ends,�we�carry�out�corporate�management�with�emphasis�on�

compliance.�With�the�Chief�Compliance�Officer�as�a�chairperson�

and�including�an�external�lawyer�as�an�observer,�the�

Compliance�Committee�develops�Mitsui’s�compliance�system�

and�maintains�and�enhances�its�effectiveness.

� The�Company�has�established�the�“Business�Conduct�

Guidelines�for�Employees�and�Officers�of�Mitsui�&�Co.,�Ltd.”�and�

has�equivalent�business�guidelines�in�place�for�its�subsidiaries.�

Mitsui�is�striving�to�improve�observance�of�these�guidelines�

through�continuous�monitoring�and�review.�In�addition,�the�

Company�has�a�total�of�eight�whistle-blowing�avenues�in�place,�

including�those�involving�an�external�attorney�at�law�and�a�

third�party�providing�hotline�services.�The�Company�made�it�

clear�that�a�whistle-blower�would�not�be�subject�to�any�recrimi-

nation�or�detrimental�treatment�by�the�Company�as�a�result�of�

whistle-blowing.�Additionally,�the�Company�makes�sure�that�its�

domestic�affiliated�companies�are�also�able�to�use�the�whistle-

blowing�avenues�(external�attorneys�at�law�and�a�third�party�

providing�hotline�services).�Mitsui’s�overseas�offices�and�over-

seas�affiliated�companies�also�have�whistle-blowing�systems�

that�were�put�in�place�considering�applicable�local�laws�and�

regional�characteristics.

� To�maintain�and�improve�its�compliance�structure,�the�

Company�consistently�conducts�activities�to�raise�employee�

awareness�toward�compliance�and�provides�as�many�opportu-

nities�as�possible�for�employees�to�better�themselves�through�

training�and�other�means.�In�doing�so,�the�Company�shares�

knowledge�and�important�points�of�concern�related�to�compli-

ance.�Any�cases�of�violation�of�compliance�are�handled�strictly,�

including�disciplinary�actions�in�accordance�with�the�

Employment�Regulations�of�Mitsui�&�Co.,�Ltd.

Compliance

Based�on�the�order�or�approval�of�the�President�and�Chief�

Executive�Officer,�the�Internal�Auditing�Division�verifies�the�

status�of�development�and�management�of�internal�controls,�

evaluates�the�suitability�and�effectiveness�of�risk�management,�

and�gives�advice�and�suggestions�for�improvements.

� During�the�regular�audits�that�cover�the�Company,�overseas�

offices,�overseas�trading�subsidiaries,�and�Japanese�and�over-

seas�affiliated�companies,�particularly�subsidiaries,�Internal�

Auditors�carry�out�independent�and�objective�evaluations,�

pursuant�to�the�rules�on�internal�audits,�etc.,�with�an�emphasis�

on�risk�management,�effectiveness�of�management�and�opera-

tions,�compliance�and�appropriate�financial�reporting.�In�addi-

tion,�the�following�audits�are�implemented�as�internal�audits:�

cross-organizational�and�cross-functional�audits�by�target�and�

item�and�extraordinary�examinations�to�get�the�whole�picture�

of�such�events�that�caused�or�could�cause�irregular�economic�

losses�or�that�jeopardized�or�could�jeopardize�the�corporate�

trust,�in�order�to�identify�the�responsibility�and�recommend�

measures�to�clarify�causes�and�methods�to�prevent�recurrence.

Internal Audits

The�Company�has�set�forth�the�“Mitsui�&�Co.,�Ltd.�Corporate�

Governance�and�Internal�Control�Principles.”�In�light�of�other�

laws�and�regulations,�Mitsui�requires�its�subsidiaries�to�develop�

and�operate�internal�controls�based�on�these�principles�and�to�

the�extent�reasonable.�For�its�equity-accounted�investees,�

Mitsui�coordinates�with�other�equity�participants�and�

encourages�the�equity-accounted�investees�to�develop�and�

operate�similar�internal�controls.�In�addition,�from�its�officers�

and�employees,�the�Company�appoints�supervising�officers�to�

each�affiliated�company�and�has�them�conduct�management�

based�on�the�“Rules�on�Delegation�of�Authority�for�Supervising�

Officers�of�Affiliated�Companies.”

Ensuring the Appropriateness of Operations within the Corporate Group


Board�of�Directors�and�Independent�DirectorsAs�of�June�21,�2018

DirectorsYears�as�a�Director�/�Number�of�Company�shares�held

1974� Joined�Mitsui�&�Co.,�Ltd.

2015� Representative�Director,�Chairman�of�the�Board�of�Directors��



2015� Representative�Director,�President�and�Chief�Executive�Officer��



2017� Representative�Director,�Executive�Vice�President,�CCO��



2018� �Representative�Director,�Executive�Vice�President��



2017� Representative�Director,�Executive�Vice�President,�CAO,�CIO,�CPO��



2018� Representative�Director,�Senior�Executive�Managing�Officer,�CDO�



2018� Representative�Director,�Senior�Executive�Managing�Officer��



2018� Representative�Director,�Executive�Managing�Officer,�CFO��



2018� Representative�Director,�Executive�Managing�Officer��


Makoto�Suzuki�3�years�/�57,931�shares



Chief�Compliance�Officer�(CCO)

Shinsuke�Fujii�2�years�/�19,589�shares



Satoshi�Tanaka�1�year�/�43,292�shares



Chief�Administrative�Officer�(CAO)

Chief�Information�Officer�(CIO)

Chief�Privacy�Officer�(CPO)

Nobuaki�Kitamori�1�year�/�23,733�shares


Senior�Executive�Managing�

Officer

Chief�Digital�Officer�(CDO)

Yukio�Takebe�New�/�16,204�shares


Senior�Executive�Managing�

Officer

Takakazu�Uchida�New�/�19,475�shares



Chief�Financial�Officer�(CFO)

Kenichi�Hori�New�/�11,729�shares



Masami�Iijima�10�years�/�95,833�shares


Chairman�of�the�Board��

of�Directors

Tatsuo�Yasunaga　�3�years�/�36,100�shares


President�and�Chief�Executive�

Officer


Independent DirectorsYears�as�a�Director�/�Number�of�Company�shares�held

1966� Entered�the�Ministry�of�Finance

1999� Director-General�of�the�Budget�Bureau,�Ministry�of�Finance

2000� Administrative�Vice�Minister,�Ministry�of�Finance

2003� Special�Advisor,�Ministry�of�Finance�

� Deputy�Governor,�Bank�of�Japan

2008� Chairman,�Daiwa�Institute�of�Research�Ltd.�(current�position)

2010� External�Director,�Mitsui�&�Co.,�Ltd.�(current�position)

1981� Joined�Mitsubishi�Chemical�Industries,�Ltd.�(currently�Mitsubishi�

Chemical�Corporation)

1985� Joined�Merrill�Lynch�Futures�Japan�Inc.

2001� President,�Merrill�Lynch�Japan�Securities�Co.,�Ltd.

2002� External�Director,�Osaka�Securities�Exchange�Co.,�Ltd.

2008� Executive�Vice�President,�Multilateral�Investment�Guarantee�Agency,�

World�Bank�Group


2015� Vice�Chairperson,�Japan�Association�of�Corporate�Executives��


1989� Joined�Haight�Gardner�Poor�&�Havens��

(currently�Holland�&�Knight�LLP)

1990� Registered�as�Attorney�at�Law,�admitted�in�New�York

1991� Joined�Industrial�Bank�of�Japan�Limited,�New�York�Branch��

(currently�Mizuho�Bank)

1994� Joined�Merrill�Lynch�Japan�Securities�Co.,�Ltd.

2000� Merrill�Lynch�Europe�Plc

2006� Bank�of�America�Merrill�Lynch�(Hong�Kong)

2012� General�Counsel�Asia,�NEW�Asurion�Asia�Pacific�Japan�LLC��

(currently�Asurion�Japan�Holdings�G.K.)�(current�position)


1972� Joined�General�Motors�Holden’s�Limited

1987� Joined�Nissan�Motor�Australia

1991� Joined�Rio�Tinto�Limited

2013� Chief�Executive�Officer,�Rio�Tinto�Limited

2016� Global�President,�The�Chartered�Institute�of�Procurement�and�Supply�


2017� Chairman,�The�Accenture�Global�Mining�Executive�Council��


� Chairman,�Royal�Flying�Doctor�Service�(WA)�(current�position)

� External�Director,�Mitsui�&�Co.,�Ltd.�(current�position)

Toshiro�Muto8�years�/�12,928�shares

External�Director

Izumi�Kobayashi4�years�/�2,820�shares

External�Director

Jenifer�Rogers3�years�/�3,565�shares

External�Director

Hirotaka�Takeuchi2�years�/�0�shares

External�Director

Samuel�Walsh1�year�/�2,700�shares

External�Director

1969� Joined�McCann-Erickson�Hakuhodo�Co.,�Ltd.��

(currently�McCann�Erikson�Japan�Inc.)

1976� Lecturer,�Harvard�Business�School

1977� Associate�Professor,�Harvard�Business�School

1983� Associate�Professor,�Hitotsubashi�University-Faculty�of�Commerce�

and�Management

1987� Professor,�Hitotsubashi�University-Faculty�of�Commerce�and�

Management

1998� Dean�of�The�Graduate�School�of�International�Corporate�Strategy,�

Hitotsubashi�University

2010� Professor�Emeritus,�Hitotsubashi�University�(current�position)�

Professor,�Harvard�Business�School�(current�position)




2015� Full-time�Audit�&�Supervisory�Board�Member�(current�position)

1995�� Appointed�Assistant�Judge�at�Tokyo�District�Court

2000�� Registered�as�Attorney�at�Law.�Joined�Hibiya�Park�Law�Offices

2002�� Partner�at�Hibiya�Park�Law�Offices�(current�position)

2014�� External�Audit�&�Supervisory�Board�Member,�Mitsui�&�Co.,�Ltd.��



2015� Full-time�Audit�&�Supervisory�Board�Member�(current�position)

1974� Appointed�Public�Prosecutor

2007�� Vice�Minister�of�Justice

2012�� Attorney�General

2014�� Registered�as�Attorney�at�Law

2015�� External�Audit�&�Supervisory�Board�Member,�Mitsui�&�Co.,�Ltd.�


Full-time�and�Independent�Audit�&�Supervisory��

Board�MembersAs�of�June�21,�2018

Audit & Supervisory Board MembersYears�as�an�Audit�&�Supervisory�Board�Member�/�Number�of�Company�

shares�held

Independent Audit & Supervisory

Board MembersYears�as�an�Audit�&�Supervisory�Board�Member�/�Number�of�Company

shares�held

Joji�Okada�3�years�/�44,371�shares

Full-time�Audit�&�Supervisory�

Board�Member

Haruka�Matsuyama�4�years�/�1,411�shares


Board�Member

Takashi�Yamauchi�3�years�/�60,511�shares

Full-time�Audit�&�Supervisory�

Board�Member

Hiroshi�Ozu�3�years�/�1,052�shares


Board�Member

1980� Joined�Shinwa�Accountants�(currently�KPMG�AZSA�LLC)

2000� � Representative�Partner

2004� � Director�of�Financial�Services

2006� � Board�Member

2011� � Chairman,�KPMG�FS�Japan

2013� Established�Mori�Certified�Public�Accountant�Office

� Chairman�and�President,�The�Japanese�Institute�of�Certified�Public�

Accountants

2016� Senior�Advisor,�The�Japanese�Institute�of�Certified�Public�Accountants�


2017� External�Audit�&�Supervisory�Board�Member,�Mitsui�&�Co.,�Ltd.��


Kimitaka�Mori�1�year�/�1,812�shares


Board�Member


President

Tatsuo�Yasunaga*President�and�Chief�Executive�Officer;�Chairman,�Internal�Controls�Committee;�Head�of�Crisis�Management�Headquarters

Executive�Vice�Presidents

Makoto�Suzuki*Chief�Compliance�Officer;�Corporate�Staff�Unit�

(Secretariat,�Audit�&�Supervisory�Board�Member�

Division,�Human�Resources�&�General�Affairs�Division,�

Legal�Division,�Corporate�Logistics�Division,�New�

Head�Office�Building�Development�Department);�

Business�Continuity�Management;�New�Headquarter�

Project;�Chairman,�Compliance�Committee;�

Chairman,�Diversity�Promotion�Committee;��

Head�of�Emergency�Management�Headquarter

Satoshi�Tanaka*Chief�Administrative�Officer;�Chief�Information�Officer;�

Chief�Privacy�Officer;�Corporate�Staff�Unit�(Corporate�

Planning�&�Strategy�Division,�Investment�

Administrative�Division,�Information�Technology�

Promotion�Division,�Regional�Business�Promotion�

Division,�Corporate�Communications�Division,�

Environmental·Social�Contribution�Division,�Business�

Supporting�Unit�(Each�Planning�&�Administrative�

Division)),�Domestic�Offices�and�Branches;��

HQ�Overseen�Region;�Business�Innovation�&�

Incubation;�Environmental�Matters;�Chairman,�

Information�Strategy�Committee;�Chairman,�

Sustainability�Committee;�Chairman,�Business�

Innovation�Committee

Shinsuke�Fujii*Healthcare�&�Service�Business�Unit;�Consumer�

Business�Unit;�Corporate�Development�Business�Unit;�

Chairman,�Portfolio�Management�Committee

Senior�Executive�Managing�Officers

Nobuaki�Kitamori*Chief�Digital�Officer,�Infrastructure�Projects�Business�

Unit;�Integrated�Transportation�Systems�Business�Unit�I;�

Integrated�Transportation�Systems�Business�Unit�II;�IT�&�

Communication�Business�Unit;�Digital�Transformation

Yukio�Takebe*Iron�&�Steel�Products�Business�Unit;�Mineral�&�Metal�

Resources�Business�Unit;�Energy�Business�Unit�I;�


Taku�MorimotoChief�Operating�Officer�of�Asia�Pacific�Business�Unit

Yasuyuki�FujitaniChief�Operating�Officer�of�EMEA�(Europe,�the�Middle�

East�and�Africa)�Business�Unit

Motoo�OnoChief�Representative�of�Mitsui�&�Co.,�Ltd.�in�China

Executive�Managing�Officers

Takakazu�Uchida*Chief�Financial�Officer;�Corporate�Staff�Unit�(CFO�

Planning�&�Administrative�Division,�Global�Controller�

Division,�Finance�Division,�Risk�Management�Division,�

Investor�Relations�Division,�Business�Supporting�Unit�

(Financial�Management�&�Advisory�Division�I,�II,�III,�IV));�

Chairman,�Disclosure�Committee;�Chairman,�J-SOX�

Committee

Kenichi�Hori*Basic�Materials�Business�Unit;�Performance�Materials�

Business�Unit;�Nutrition�&�Agriculture�Business�Unit;�

Food�Business�Unit;�Food�&�Retail�Management�

Business�Unit

Shinsuke�KitagawaGeneral�Manager�of�Osaka�Office

Noboru�KatsuChairman�&�CEO�of�Mitsui�&�Co.�(Australia)�Ltd.

Hiromichi�YagiChief�Representative�of�Mitsui�&�Co.,�Ltd.�in�South�West�

Asia;�Managing�Director,�Mitsui�&�Co.,�India�Pvt.�Ltd.

Shinichiro�OmachiChief�Operating�Officer�of�Mineral�&�Metal�Resources�

Business�Unit

Hiroyuki�TsurugiRepresentative�Director,�President�&�CEO�of�Mitsui�Oil�

Exploration�Co.,�Ltd.

Hirotatsu�FujiwaraChief�Operating�Officer�of�Energy�Business�Unit�II

Shingo�SatoChief�Operating�Officer�of�Integrated�Transportation�


Katsurao�YoshimoriChief�Operating�Officer�of�Americas�Business�Unit

Osamu�ToriumiGeneral�Manager�of�Internal�Auditing�Division

Shinji�TsuchiyaPresident�of�Mitsui�&�Co.�(Brasil)�S.A.

Managing�Officers

Shin�HatoriGeneral�Manager�of�Nagoya�Office

Hiroshi�MeguroDeputy�Chief�Administrative�Officer�(HQ�Overseen�

Region)

Kimiro�ShiotaniGeneral�Manager�of�Global�Controller�Division

Miki�YoshikawaChief�Operating�Officer�of�Food�Business�Unit

Yoshio�KometaniChief�Operating�Officer�of�Infrastructure�Projects�

Business�Unit

Toshiaki�MaruokaChief�Representative�of�Mitsui�&�Co.,�Ltd.�in�CIS;�

General�Director�of�Mitsui�&�Co.�Moscow�LLC

Motoaki�UnoPresident�&�CEO�of�P.T.�Mitsui�Indonesia

Koji�NagatomiChief�Operating�Officer�of�Healthcare�&�Service�

Business�Unit

Kohei�TakataChief�Operating�Officer�of�Nutrition�&�Agriculture�

Business�Unit

Sayu�UenoChief�Operating�Officer�of�Basic�Materials�Business�

Unit

Yumi�YamaguchiPresident�&�CEO,�Mitsui�Global�Strategic�Studies�

Institute

Masaki�SaitoChief�Operating�Officer�of�IT�&�Communication�

Business�Unit

Takeshi�SetozakiChief�Operating�Officer�of�Integrated�Transportation�


Reiji�FujitaChief�Operating�Officer�of�Consumer�Business�Unit;�

General�Manager�of�New�Head�Office�Building�

Development�Department

Takeo�KatoChief�Operating�Officer�of�Performance�Materials�

Business�Unit

Yuki�KoderaGeneral�Manager�of�Planning�&�Administrative�

Division�(Metals)

Hirohiko�MiyataGeneral�Manager�of�Investment�Administrative�

Division

Yoshiki�HirabayashiChief�Operating�Officer�of�Food�&�Retail�Management�

Business�Unit

Yoshiaki�TakemasuGeneral�Manager�of�Human�Resources�&�General�

Affairs�Division

Yoshimitsu�GushikenGeneral�Manager�of�Finance�Division

Shinichi�HoriChief�Operating�Officer�of�Iron�&�Steel�Products�

Business�Unit

Shinichi�KikuchiharaChief�Operating�Officer�of�Corporate�Development�

Business�Unit

Masaharu�OkuboChief�Operating�Officer�of�Energy�Business�Unit�I

Executive�OfficersAs�of�June�21,�2018

Executive Officers * Corporate officer also serving as a director.


Fact DataCHAPTER 5


Financial�information�listed�in�the�Fact�Data�section�was�taken�from�the��

Annual Securities Report.�Please�refer�to�this�report�for�more�detailed�financial�

information�and�the�Independent�Auditor’s�Report.

Fact DataCHAPTER 5

096 Mitsui’s Continuing Evolution by

Meeting the Changing Needs of the Times

098 10-Year Financial Data

100 Participation in Initiatives

101 Evaluation by Society

102 Operating Environment Analysis

104 Consolidated Statements of

Financial Position

108 Consolidated Statements of Income and

Comprehensive Income

110 Consolidated Statements of Cash Flows

112 Segment Information

115 Consolidated Statements of

Changes in Equity

116 Risk Information

123 Major Risk Exposure by Country and

Fund Operation

124 Investor Information


①�Daiichi�Bussan�Kaisha,�Ltd.�(Tokyo) ②�The�Abu�Dhabi�LNG�project�(UAE) ③�Sakhalin Ⅱ projects�(Russia)

Mitsui’s�Continuing�Evolution�by�Meeting�the�Changing�

Needs�of�the�Times

19901980197019601950

©��Sakhalin�Energy

Contributed to the

recovery of the postwar

Japanese economy

As the driving force of high

economic growth

�� In�view�of�Japan’s�high�dependence��

on�overseas�sources�for�key�materials,��

Mitsui�invested�in�the�development�of��

our�own�sources�of�mineral�resources��

and�energy�with�the�aim�of�ensuring��

their�stable�supply�to�Japan

•��In�1963,�participated�in�the�development�of�the�Moura�

coal�mine�in�Australia�(currently�the�Dawson�coal�mine)

•��In�1967,�established�an�iron�ore�joint�venture�business�

with�BHP�Billiton�in�Australia

•��In�1969,�established�Mitsui�Oil�Exploration�Co.,�Ltd.

•��In�1970,�established�Mitsui�Iron�Ore�Development�

(MIOD)�in�Australia�(Robe�River�iron�ore�joint�venture)

•��In�1971,�signed�a�basic�contract�for�the�development�of�

an�LNG�facility�on�Das�Island�in�Abu�Dhabi�……�②

�

�� Supported�overseas�business��

development�of�Japanese�products

•��Promoted�export�sales�of�iron�and�steel�products,�

machinery�and�chemicals

•��Invested�in�overseas�production�and�sales�operations�of�

Japanese�automotive�and�motorcycle�makers�(Toyota�

Motor�Group,�Hino�Motor�Group,�Yamaha�Motor�Co.,�Ltd.)�

in�such�countries�as�Thailand,�Canada,�Peru�and�the�U.K.

�

�� Introduced�overseas�technologies��

and�business�models�to�Japan

•��In�1958,�established�Nippon�Remington�Univac�Kaisha,�

Ltd.�(currently�Nihon�Unisys,�Ltd.)�and�shortly�after�

helped�lay�the�groundwork�for�the�computerization��

of�Japan

•��In�1976,�established�AIM�SERVICES�CO.,�LTD.�with�major�

U.S.�contract�food�service�company�ARA�(currently�

Aramark�Corporation)

Challenges as the pioneer of the era,

responding to the rapid structural

change of society

�� Further�strengthened�functions,��

including�IT�(information�technology),��

FT�(financial�technology)�and��

LT�(logistics�technology)

•�In�1989,�Japan�Communications�Satellite,�in�which�

the�Company�invested,�successfully�launched�a��

communications�satellite

•��Provided�supply�chain�management�for�the�Ito-�

Yokado�Group�(currently�Seven�&�i�Holdings�Co.,�Ltd.)

�

�� Accelerated�the�planning�and��

development�of�large-scale��

LNG�projects�in�accordance��

with�efforts�to�diversify��

Japan’s�energy�supply�sources

•��In�1985,�participated�in�the�Western�Australia��

LNG�project

•��In�1989,�participated�in�the�Qatar�LNG�project

•��In�1994,�signed�development�contracts�for�the�

Sakhalin�II�petroleum�and�natural�gas�projects�……�③

�

�� Acquired�and�developed��

large-scale�businesses�overseas

•��In�1991,�acquired�feed�additive�business�(currently�

Novus�International,�Inc.)�from�Monsanto�Company,�

of�the�U.S.

•��In�1994,�established�P.T.�PAITON�ENERGY,�an�electric�

power�company�in�Indonesia

�� Daiichi�Bussan�imported�

daily�necessities�into�

postwar�Japan�and��

promoted�exports��

as�postwar�controls��

were�lifted.

•��In�1947,�Daiichi�Bussan�Kaisha,�

Ltd.�established�……�①

•��In�1959,�Daiichi�Bussan�Kaisha,�

Ltd.�integrated�with�other�trading�

companies�(Mitsui�&�Co.’s�great�

amalgamation)�and�changed�its�

name�to�Mitsui�&�Co.,�Ltd.


④�Vale’s�Carajás�iron�ore�mine�(Brazil) ⑤�Mount�Elizabeth�Novena�Hospital,�an�IHH�hospital�(Singapore) ⑥��432�Park�Avenue,�owned�by�CIM�Group�(New�York)

20102000 2005 2015

©�Photo:�Dario�Zalis�/�Vale

Development of various businesses with world class partners

in response to the rapid growth of emerging economies and

the evolving global industrial structure

�� Long-term�initiatives�in�developing�resources�and�energy�businesses�to�enhance�our�ability�to�provide�sustainable�supply

•��In�2003,�purchased�ownership�interest�in�Valepar�S.A.,�the�holding�company�of�Vale�S.A.,�the�Brazilian�diversified�resource�development�company�……�④

•��In�2010,�acquired�working�interest�in�shale�gas�in�the�Marcellus�area�and,�in�the�following�year,�in�shale�oil�in�the�Eagle�Ford�area,�both�in�the�U.S.

•��In�2012,�established�a�strategic�partnership�with�Corporación�Nacional�del�Cobre�de�Chile�and�acquired�copper�interests

•��In�2013,�acquired�interest�in�the�Jimblebar�Iron�Ore�mine�in�Western�Australia

•��In�2015,�completed�second�phase�of�expansion�of�Robe�River�J/V�mine�and�port

•��In�2016,�acquired�working�interest�in�Kipper�gas�and�condensate�field�in�Australia

•��In�2016,�acquired�stake�in�oil�and�gas�development�project�in�the�Gulf�of�Mexico

•��In�2018,�acquired�AWE�Limited,�an�oil�and�gas�company�in�Australia

�

�� Response�to�new�needs�for�enhancing�industry�and�enriching�lifestyles

•��In�2001,�launched�24-hour�shopping�channel�in�Japan�with�QVC�network

•��In�2001,�invested�in�a�major�U.S.�automotive�dealer�Penske�Automotive�Group

•��In�2007,�commenced�capital�and�business�alliance�with�Sogo�Medical�Co.,�Ltd.

•��In�2008,�launched�chemical�tank�terminal�business�at�the�Port�of�Antwerp�in�Europe

•��In�2011,�invested�in�Asia’s�largest�private�hospital�group�Integrated�Healthcare�Holdings�(currently�IHH�Healthcare�Bhd.)�……�⑤

•��In�2015,�invested�in�a�major�U.S.�truck�leasing�company�Penske�Truck�Leasing

•��In�2015,�commenced�commercial�production�of�methanol�at�Fairway�Methanol�LLC�in�the�U.S.

•��In�2016,�invested�in�Asia’s�largest�hospital�for�middle-income�patients,�Columbia�Asia

•��In�2016,�invested�in�the�Spain-based�Gestamp�Automoción,�S.A.,�the�world’s�largest�automotive�press�components�manufacturer

•��In�2017,�invested�in�Panasonic�Healthcare�Holdings�Co.,�Ltd.,�a�medical�equipment�manufacturer

•��In�2017,�invested�in�CIM�Group,�a�major�real�estate�asset�management�company�in�the�U.S.�……�⑥

�

�� Developing�infrastructure�businesses�that�contribute�to�nation�building�and�industrial�promotion�in�countries��

around�the�world

•��In�2004,�jointly�acquired�13�power�generating�assets�with�International�Power�(currently�ENGIE)

•��In�2006,�acquired�a�gas�distribution�business�in�Brazil

•��In�2006,�invested�in�Thai�Tap�Water�Supply�Public�Company�Limited,�a�water�supply�company�in�Thailand

•��In�2014,�invested�in�VLI�S.A.,�a�Brazilian�integrated�logistics�company�owned�and�operated�by�Vale�S.A.

•��In�2015,�participated�in�a�passenger�railway�transportation�business�in�Brazil,�owned�and�operated�by�Odebrecht�TransPort�S.A.

•�In�2017,�invested�in�Moatize�coal�mine�and�the�Nacala�rail�and�port�infrastructure�projects�in�Mozambique


10-Year�Financial�Data�(Including�Sustainability�Data)

Mitsui�&�Co.,�Ltd.�and�its�subsidiaries

Fiscal�years�to�March�31

U.S.�GAAP

Billions�of�Yen

2008 2009 2010 2011 2012 2013 2014

Consolidated Operating Results (For the Year):

Revenues 5,738.9 5,535.2 4,096.4 4,679.4 5,251.6 4,911.6 5,740.7�

Gross�Profit � 988.1 1,016.3 � 702.0 � 859.2 � 878.3 � 790.4 � 859.9�

Operating�Income � 374.8 � 394.7 � 144.5 � 317.0 � 348.4 � 254.6 � 275.2�

Equity�in�Earnings�of�Associated�Companies � 154.3 � 84.8 � 131.5 � 242.1 � 232.1 � 176.2 � 173.7�

Net�Income�Attributable�to�Mitsui�&�Co.,�Ltd. � 410.1 � 177.6 � 149.7 � 306.7 � 434.5 � 307.9 � 422.2�

Consolidated Financial Position

(At Year-End):

Total�Assets 9,690.9 8,364.2 8,369.0 8,598.1 9,011.8 10,324.6 11,001.3�

Total�Mitsui�&�Co.,�Ltd.�Shareholders’�Equity 2,183.7 1,881.7 2,230.1 2,366.2 2,641.3 � 3,181.8 � 3,586.4�

Interest-bearing�Debt 3,685.6 3,668.6 3,471.7 3,377.5 3,578.0 � 4,269.3 � 4,455.1�

Net�Interest-bearing�Debt 2,774.0 2,515.1 2,055.7 1,933.9 2,142.8 � 2,839.4 � 3,224.4�

Consolidated Cash Flows (For the Year):

Net�Cash�Provided�by�Operating�Activities � 415.8 � 582.7 � 632.4 � 504.5 � 381.0 � 461.4 � 521.5�

Net�Cash�Used�in�Investing�Activities � (104.8) � (290.9) � (180.1) � (484.0) � (438.2) � (753.3) � (704.5)

Net�Cash�Provided�by�(Used�in)��

Financing�Activities� (185.1) � �(9.8) � (214.4) � 33.8 � 57.4 � 221.6 � (34.7)

Free�Cash�Flow � 311.0 � 291.8 � 452.3 � 20.5 � (57.2) � (291.9) � (183.0)

Investments�and�Loans � (710.0) � (520.0) � (360.0) � (690.0) � (650.0) � (960.0) � (1,010.0)

Divestitures � 610.0 � 190.0 � 210.0 � 190.0 � 210.0 � 220.0 � 305.0�

Net�Cash�Outflow � (100.0) � (330.0) � (150.0) � (500.0) � (440.0) � (740.0) � (705.0)

Financial Indicators:

Return�on�Equity�(ROE)�(%) 19.1% 8.7% 7.3% 13.3% 17.4% 10.6% 12.5%

Return�on�Assets�(ROA)�(%) 4.2% 2.0% 1.8% 3.6% 4.9% 3.2% 4.0%

Net�Debt-to-Equity�Ratio�(Net�DER)�(times) 1.27 1.34 0.92 0.82 0.81 0.89 0.90

Yen

Amounts per Share:

Net�Income�Attributable�to�Mitsui�&�Co.,�Ltd.

　Basic 227.20 97.59 82.12 168.05 238.10 168.72 231.79

　Diluted � 224.82 � 97.32 � 82.11 � 168.05 — — � 231.78

Cash�Dividends � 46 � 25 � 18 � 47 � 55 � 43 � 59

Consolidated�Dividend�Payout�Ratio�(%) 20.2% 25.6% 21.9% 28.0% 23.1% 25.5% 25.5%

Shareholders’�Equity 1,202.03 1,033.22 1,222.11 1,296.66 1,447.34 1,743.34 2,000.78

Stock Price:

Stock�Price�(closing�stock�price�on�the�Tokyo�

Stock�Exchange)�(yen)� 2,020� � 986� � 1,571� � 1,491� � 1,357� 1,313 1,459

Price�Earnings�Ratio�(PER)�(times) 8.89 10.10 19.13 8.87� 5.70 7.78 6.29

Price�Book-Value�Ratio�(PBR)�(times) 1.68� 0.95 1.29� 1.15� 0.94� 0.75� 0.73

Sustainability:

Number�of�Employees�(Consolidated) 42,621 39,864 41,454 40,026 44,805 45,148 48,090

Ratio�of�External�Directors�(%) 30.8% 33.3% 30.8% 30.8% 30.8% 30.8% 30.8%

Paper�Consumption�(thousand�sheets;�

A4-size�equivalent)92,973 85,547 76,049 66,701 59,810 57,833 56,588

Notes:� 1.� �Figures�for�prior�years�have�not�been�reclassified�in�accordance�with�Accounting�Standard�Codification�(“ASC”)�205-20,�“Presentation�of�Financial�Statements–�

Discontinued�Operations.”

� 2.� �Operating�Income�is�comprised�of�“gross�profit,”�“selling,�general�and�administrative�expenses,”�and�“provision�for�doubtful�receivables.”

� 3.� �Tax�effects�on�investments�in�associated�companies�which�were�formerly�included�in�“Equity�in�Earnings�of�Associated�Companies”�are�included�in�“Income�Taxes”�

from�the�year�ended�March�2010.�Figures�for�prior�years�have�not�been�reclassified.

� 4.� �Per-share�information�is�calculated�based�on�the�number�of�shares�issued�at�year-end.

� 5.� �Diluted�net�income�attributable�to�Mitsui�&�Co.,�Ltd.�per�share�for�the�years�ended�March�31,�2012�and�2013�are�not�disclosed�because�there�are�no�dilutive�

potential�shares.

� 6.� �Price�earnings�ratio�(PER)�is�calculated�based�on�the�year-end�closing�stock�price�on�the�Tokyo�Stock�Exchange�divided�by�basic�net�income�attributable�to��

Mitsui�&�Co.,�Ltd.�per�share.

� 7.� �Price�book-value�ratio�(PBR)�is�calculated�based�on�the�year-end�closing�stock�price�on�the�Tokyo�Stock�Exchange�divided�by�shareholders’�equity�per�share.

� 8.� �Ratio�of�external�directors�is�calculated�based�on�director�numbers�upon�the�conclusion�of�the�general�meeting�of�shareholders�held�after�the�end�of�the��

respective�fiscal�year.

� 9.� �Paper�consumption�is�calculated�based�on�all�offices�in�Japan�(Head�Office�(Tokyo),�6�offices�and�5�branches).


IFRS

Billions�of�YenMillions�of��

U.S.�Dollars

2013 2014 2015 2016 2017 2018 2018

Consolidated Operating Results (For the Year):

Revenue 4,912.1� 5,731.9� 5,404.9� 4,759.7 4,364.0 4,892.1 46,152

Gross�Profit 814.1� 880.1� 845.8 726.6 719.3 790.7 7,459

Share�of�Profit�(Loss)�of�Investments

Accounted�for�Using�the�Equity�Method183.1� 171.2� 144.6 (132.0) 170.6 234.9 2,216

Profit�(Loss)�for�the�Year�Attributable�to��

Owners�of�the�Parent296.6� 350.1� 306.5 (83.4) 306.1 418.5 3,948

Consolidated Financial Position

(At Year-End):

Total�Assets 10,777.3� 11,491.3� 12,202.9 10,910.5 11,501.0 11,306.7 106,667

Total�Equity�Attributable�to�Owners�of�the�Parent 3,439.1� 3,815.8� 4,099.8 3,379.7 3,732.2 3,974.7 37,497

Interest-bearing�Debt 4,176.4 4,411.1 4,793.9 4,710.5 4,801.6 4,226.9 39,877

Net�Interest-bearing�Debt 2,739.1� 3,178.8� 3,382.2 3,215.0 3,282.1 3,089.2 29,144

Consolidated Cash Flows (For the Year):

Net�Cash�Provided�by�Operating�Activities 455.3� 449.2� 640.0 587.0 404.2 553.6 5,223

Core�Operating�Cash�Flow — 608.9 661.6 471.7 494.8 666.5 6,288

Net�Cash�Used�in�Investing�Activities (754.5) (659.8) (386.4) (408.1) (353.3) (248.2) (2,342)

Net�Cash�Provided�by�(Used�in)�Financing�Activities 236.3� (13.2) (126.2) (50.5) (50.3) (652.3) (6,154)

Free�Cash�Flow (299.2) (210.6) 253.6 178.9 50.9 305.4 2,881

Investments�and�Loans — — (715.0) (600.0) (635.0) (560.0) (5,283)

Divestitures — — 340.0 190.0 290.0 300.0 2,830

Net�Cash�Outflow — — (375.0) (410.0) (345.0) (260.0) (2,453)

Financial Indicators:

Return�on�Equity�(ROE)�(%) 9.4% 9.7% 7.7% (2.2%) 8.6% 10.9%

Return�on�Assets�(ROA)�(%) 2.9% 3.1% 2.6% (0.7%) 2.7% 3.7%

Net�Debt-to-Equity�Ratio�(Net�DER)�(times) 0.80 0.83 0.82 0.95 0.88 0.78

Yen� U.S.�Dollars

Amounts per Share:

Profit�(Loss)�for�the�Year�Attributable�to��

Owners�of�the�Parent

　Basic 162.53� 192.22� 170.98 (46.53) 171.20 237.67 2.24

　Diluted — 192.21� 170.95 (46.54) 171.10 237.50 2.24

Cash�Dividends 43 59 64 64 55 70 0.63

Consolidated�Dividend�Payout�Ratio�(%) 26.5% 30.7% 37.4% — 32.1% 29.5%

Total�Equity�Attributable�to�Owners�of�the�Parent 1,884.33 2,128.73 2,287.17 1,885.47 2,115.80 2,287.10 21.58

Stock Price:

Stock�Price�(closing�stock�price�on�the�Tokyo�

Stock�Exchange)�(yen)1,313� 1,459 1,612 1,295 1,612.5 1,822.5

Price�Earnings�Ratio�(PER)�(times) 8.08 7.59 9.43 — 9.42 7.67

Price�Book-Value�Ratio�(PBR)�(times) 0.70� 0.69� 0.70 0.69 0.76 0.80

Sustainability:

Number�of�Employees�(Consolidated) 45,148 48,090 47,118 43,611 42,316 42,304

Ratio�of�External�Directors�(%) 30.8% 30.8% 35.7% 35.7% 35.7% 35.7%

Paper�Consumption�(thousand�sheets;��

A4-size�equivalent)57,833 56,588 50,155 50,369 48,529 45,894

Notes:� 1.� �We�do�not�disclose�“Core�Operating�Cash�Flow”�for�2013.

� 2.� �Figures�calculated�in�accordance�with�IFRS�standards�for�investments�and�loans,�divestitures,�and�net�cash�outflow�are�have�not�been�disclosed�for�the�fiscal�years�

ended�March�31,�2013�and�2014.

� 3.� �Per�share�information�is�calculated�based�on�the�number�of�shares�issued�at�year-end.

� 4.� �Diluted�earnings�per�share�attributable�to�owners�of�the�parent�in�the�fiscal�year�ended�March�31,�2013,�are�not�disclosed�because�there�are�no�dilutive�potential�shares.

� 5.� �Price�earnings�ratio�(PER)�is�calculated�based�on�the�year-end�closing�stock�price�divided�by�basic�profit�(attributable�to�owners�of�the�parent)�per�share.

� 6.� �The�consolidated�dividend�payout�ratio�for�2016�was�omitted�due�to�a�loss.

� 7.� �The�price�earnings�ratio�(PER)�for�2016�was�omitted�due�to�a�loss.

� 8.� �Price�book-value�ratio�(PBR)�is�calculated�based�on�the�year-end�closing�stock�price�divided�by�equity�attributable�to�owners�of�the�parent�per�share.

� 9.� �The�U.S.�dollar�amounts,�except�cash�dividends,�represent�translations�of�the�Japanese�yen�amounts�at�the�rate�of�¥106.00=U.S.$1,�the�approximate�rate�of�

exchange�on�March�31,�2018.

� 10.� �The�U.S.�dollar�amounts�for�cash�dividends�represent�translations�of�the�Japanese�yen�amounts�at�the�rate�in�effect�on�the�payment�date.


Participation�in�Initiatives

In�October�2004,�the�Company�signed�and�pledged�its�support�for�the�UN�Global�Compact.�The�Company�has��

been�participating�as�a�member�of�Global�Compact�Network�Japan�and�is�complying�with�the�principles�as�part��

of�its�own�corporate�guidelines.�Currently�the�Company�conducts�a�companywide�survey�every�other�year�in��

order�to�check�compliance�with�the�UN�Global�Compact�principles�and�is�working�to�comply�with�and�practice��

the�principles�on�a�global�group�basis.

Mitsui�uses�its�capabilities�in�the�five�areas�of�marketing,�financing,�logistics,�risk�management,�and�IT�process�configuration�to��

develop�diverse�business�operations�across�nations�and�regions.�As�such,�we�believe�that�we�can�leverage�these�capabilities�to�make�a�

wide-ranging�contribution�to�the�achievement�of�the�17�goals.�We�will�strive�to�achieve,�in�particular,�the�goals�related�to�our�identified�

material�issues�in�partnership�with�our�stakeholders.

� As�a�corporate�member�of�Global�Compact�Network�Japan,�Mitsui�will�continue�

to�raise�awareness�of�the�SDGs�in�its�business�organizations,�to�reflect�the�SDGs��

in�our�business�strategies,�and�to�ensure�that�our�business�activities�are�always�

guided�by�a�determination�to�contribute�to�the�achievement�of�the�SDGs.

� Please�refer�to�the�Sustainability Report�for�information�on�the�themes�of��

initiatives�Mitsui�has�determined�by�material�issue�as�well�as�the�relationship��

of�these�initiatives�with�the�17�goals�and�169�targets�laid�out�in�the�UN�SDGs.��

The�Sustainability Report�also�introduces�the�specific�activities�that�Mitsui�is��

pursuing�to�realize�the�SDGs.

•��World�Economic�Forum

•��Japan�Foreign�Trade�Council,�Inc.:�Global�Environment�Committee,�CSR�Study�Committee

•��Japan�Business�Federation�(Keidanren):�Committee�on�Corporate�Behavior�&�Social�Responsibility,�Committee�on�Gender�Diversity,�

Committee�on�Environment�and�Safety,�Committee�on�Nature�Conservation

•��Council�for�Better�Corporate�Citizenship�(CBCC)

•��Japan�Forum�of�Business�and�Society�(JFBS)

•��Japan�Business�and�Biodiversity�Partnership

•��Forest�Stewardship�Council�(FSC®)

•��Roundtable�on�Sustainable�Palm�Oil�(RSPO)

Ten Principles of the UN Global Compact

Human Rights 1.� �Businesses�should�support�and�respect�the�protection�of�internationally�proclaimed�human�rights;�

and

2.� make�sure�that�they�are�not�complicit�in�human�rights�abuses.

Labor 3.� �Businesses�should�uphold�the�freedom�of�association�and�the�effective�recognition�of�the�right�to�

collective�bargaining;

4.� the�elimination�of�all�forms�of�forced�and�compulsory�labor;

5.� the�effective�abolition�of�child�labor;�and

6.� the�elimination�of�discrimination�in�respect�of�employment�and�occupation.

Environment 7.� Businesses�should�support�a�precautionary�approach�to�environmental�challenges;

8.� undertake�initiatives�to�promote�greater�environmental�responsibility;�and

9.� encourage�the�development�and�diffusion�of�environmentally�friendly�technologies.

Anti-Corruption 10.� Businesses�should�work�against�corruption�in�all�its�forms,�including�extortion�and�bribery.

United Nations Global Compact

Sustainable Development Goals (SDGs)

Other Initiatives


Evaluation�by�Society

Top Award for Excellence in Corporate Disclosure

The�Company�has�been�selected�for�the�top�award�in�the�commerce�industry�category�at�the�2017�

Awards�for�Excellence�in�Corporate�Disclosure.�Organized�by�the�Securities�Analysts�Association�of�

Japan,�this�was�the�23th�holding�of�the�awards.�The�Company�received�the�highest�scores�in�all�five�of�

the�above�criteria�in�the�commerce�industry�category.

Dow Jones Sustainability Indices

The�Dow�Jones�Sustainability�Indices�is�a�global�stock�index�developed�jointly�by�Dow�Jones�&�Company�

in�the�U.S.�and�RobecoSAM�AG�in�Switzerland.�Major�corporations�around�the�world�are�evaluated�in�

terms�of�their�economic,�environmental,�and�social�performance.�The�Company�was�selected�for�both�

the�World�Index�and�Asia�Pacific�Index�in�2017.

RobecoSAM Sustainability Award

RobecoSAM�carries�out�surveys�and�analyses�for�the�Dow�Jones�Sustainability�Indices.�From�each�

industry,�it�recommends�companies�that�have�undertaken�outstanding�environmental,�social,�and�

economic�initiatives.�In�the�Trading�Companies�&�Distributors�category,�the�Company�was�selected��

as�one�of�the�companies�to�be�ranked�Gold�Class,�which�is�awarded�to�companies�that�are�within�a��

1%�range�of�the�score�of�the�industry�leaders.

FTSE4Good Index Series

The�FTSE4Good�Index�Series�is�a�stock�index�developed�by�FTSE�Russell,�which�is�a�wholly�owned�

subsidiary�of�the�London�Stock�Exchange.�FTSE�Russell�evaluates�major�corporations�around�the�world�

from�the�aspects�of�environmental,�social,�and�governance�criteria,�including�the�labor�standards�

applied�throughout�their�supply�chains,�as�well�as�on�the�basis�of�corporate�sustainability.�It�selects�

companies�that�satisfy�its�standards�as�constituents�of�the�index.�The�Company�fulfilled�the�criteria�of�

the�index�and�was�selected�in�the�FTSE4Good�Index�Series.

FTSE Blossom Japan Index

The�FTSE�Blossom�Japan�Index�is�designed�to�measure�the�performance�of�Japanese�companies��

that�demonstrate�strong�environmental,�social,�and�governance�(ESG)�practices.�The�index�uses�FTSE�

Russell’s�ESG�Ratings�data�model,�which�draws�on�existing�international�ESG�standards�such�as�the��

UN�Sustainable�Development�Goals�(SDGs).�The�Company�fulfilled�the�criteria�of�the�index�and�was�

selected�in�the�FTSE�Blossom�Japan�Index�in�2017.

Carbon Disclosure Project (CDP)

CDP�is�a�London-based�non-profit�organization�operated�collaboratively�by�institutional�investors.��

Its�purpose�is�to�urge�leading�companies�(in�terms�of�aggregate�value)�in�major�countries�to�disclose�

their�environmental�strategies�and�greenhouse�gas�emissions;�the�Company�has�continued�to�answer�

the�questionnaire�since�2012.�In�2017,�Mitsui�was�granted�the�rating�“Management�Level�B”�in�relation�

to�both�climate�change�and�water.

Inclusion in the 2018 Competitive IT Strategy Company Stock Selection

The�Competitive�IT�Strategy�Company�Stock�Selection�is�designated�by�the�Ministry�of�Economy,�Trade�

and�Industry�and�the�Tokyo�Stock�Exchange�(TSE)�on�the�basis�of�outstanding�IT�utilization�initiatives.�

The�Company�has�been�selected�for�four�years�in�a�row�since�the�launch�of�the�award�in�2015.

Nadeshiko Brand

The�Nadeshiko�Brand�is�a�designation�jointly�awarded�by�the�Ministry�of�Economy,�Trade�and�Industry�

and�the�Tokyo�Stock�Exchange�(TSE)�to�companies�listed�in�all�TSE�sections�that�have�shown�excellence�

in�promoting�career�advancement�for�women.�In�the�fiscal�year�ended�March�2018,�the�Company�was�

selected�as�a�Nadeshiko�Brand�company�for�its�proactive�efforts�to�support�women�to�play�more�active�

roles�in�the�workplace.�Including�being�selected�as�a�Semi-Nadeshiko�Brand�last�year,�this�is�the�fourth�

year�running�that�the�Company�has�been�recognized�as�a�Nadeshiko�Brand.

Eruboshi (L Star)

Eruboshi�status�is�awarded�to�companies�that�have�submitted�notifications�under�the�Act�on�Promotion�

of�Women’s�Participation�and�Advancement�in�the�Workplace�(Promotion�of�Women’s�Career�Activities�

Act)�promulgated�on�April�1,�2016.�Requirements�for�certification�include�the�fulfillment�of�specific�

standards�and�the�implementation�of�outstanding�initiatives�to�promote�the�advancement�of�women�

in�the�workplace.�In�September�2016,�the�Minister�of�Health,�Labour�and�Welfare�certified�the�Company�

as�having�achieved�the�second�of�three�levels�under�the�Eruboshi�system.

最小サイズヨコ 12.8 ミリまで

Major Selection and Certification�(Year�to�March�31,�2018)


Operating Environment Analysis

Operating Environment

Note: The following describes the understanding of the eco-

nomic environments as of May 2018. Descriptions included

herein may differ from our current understanding.

In the fiscal year ended March 31, 2018, the global economy

saw ongoing gradual growth in both developed countries and

emerging countries supported by firm spending and investment.

In the U.S., consumer spending continues to be resilient sup-

ported by a favorable environment for employment and

employee income. At the same time, tax reform is expected to

drive capital investment. As such, economic recovery is expected

to continue for the time being. In Europe, though the economy

has been resilient following growth in spending and investment,

this growth is expected to weaken going forward as corporate

business confidence plateaus. In Japan, gradual economic recov-

ery is expected to continue as a result of consumer spending

continuing to be resilient following improvement in the employ-

ment environment, and because of increases in both investment

related to the Olympic and Paralympic Games, and in capital

investment focused on labor-saving initiatives. In emerging

countries, while stable growth continues in China, this growth is

expected to weaken following an environment of excess capacity

and adjustments of debts. At the same time, future growth is

expected in India due to the progress of economic reform such as

the introduction of the Goods and Services Tax. Also, the trend of

gradual recovery is expected to continue in Brazil with consump-

tion and investment picking up. However, limited growth is

expected to continue in Russia due in part to ongoing sanctions

from the U.S. and other nations.

The global economy is expected to follow a trend of gentle

recovery going forward. However, careful watch continues to

be needed on the escalation of geopolitical risk surrounding

the Middle East, the future prospects for the European and U.S.

economies, which have shown signs of maturity in some parts,

the impact of the Federal Reserve Board’s monetary tightening

on the economies of emerging countries, and trends in U.S.

trade policy.

Business Environment by Segment


Global steel output for 2017 increased by 5.3% year-on-year to

approximately 1.7 billion tons, reflecting steel demand not only

in emerging markets such as China and India but also in North

America and the EU. On the other hand, due to continued exces-

sive steel supply mainly from Chinese steel manufacturers, which

account for almost half of the global steel output, the difficult

business environment is expected to persist. Under this situation,

amid the integration in the steel industry even more intensified

reorganization could occur among steel distributors.

Over the medium to long term, the domestic iron and steel

market is expected to shrink gradually due to population decline,

among other factors. However, we anticipate that the Americas

and Asia will drive a global economic recovery, resulting in

increased demand overseas for iron and steel products. Many

business opportunities are expected to arise from this

development.

Mineral & Metal Resources

In the short term, there is a risk that economic growth in China

and emerging countries could slow down, which may lead to a

weaker commodity market, however, steel and non-ferrous

metals are core industrial materials, and demand for these mate-

rials is likely to grow over the long term. On the other hand, over

the medium to long term, supply and demand is expected to be

tightened due to supply limitations resulting from the limited

availability of high-quality undeveloped projects, in addition to

rising development and production costs, depletion of reserves,

and deterioration of quality minerals from existing mines. The

segment believes the mineral and metal resources business will

continue to be an important aspect of its operations.


In emerging countries, where economies and populations

continue to grow markedly, demand is rising for the develop-

ment of basic infrastructure, including electrical, water-related

and logistical infrastructure. As for industrialized countries, aging

infrastructure is leading to increased demand for repairs. The

efforts to create a low-carbon society are also boosting demand

for related infrastructure investment, such as a rapid expansion

of environmentally friendly renewable energy. Moreover, as

facilities and equipment for energy resource development

become more advanced, larger, and more complex, develop-

ment demand is rising overall. In the U.S., the progress of shale

oil and gas development is heightening demand, not only for

infrastructure development but also for pipeline transportation,

downstream chemical manufacturing, gas-fired power genera-

tion, and LNG shipping facilities. On the other hand, policy

interest rates have reached a historical low level backed by the

implementation of quantitative easing policies by central banks

primarily in industrialized countries, and greater attention is

being paid to infrastructure projects from which stable earnings

are expected, following an increase in the amount of investment-

ready cash. The segment believes the infrastructure business will

continue to be an important aspect of its operations.

As demand for resource and energy is seen to rise over

the medium to long term with growth in emerging countries,

demand for mining machinery should recover and market

conditions are expected to pick up due to an increase in land-

and-sea-based logistics. In the U.S., the manufacturing industry is

undergoing a revival, and the underlying trend of improvement

in U.S. business conditions is having a favorable effect on our

automotive, truck, machine tool, and construction machinery

businesses. Economic expansion in emerging economies has

fostered growing concern about associated environmental

problems, and a shift to public transportation has been encour-

aged as a solution to traffic congestion. As a result, demand for

passenger and freight railway facilities is expected to increase.

Due to ongoing global economic growth, the number of airline

passengers is expected to increase over the medium to long

term, and consequently, demand for airframes and engines is

also expected to rise. Meanwhile, as global warming, population

growth, urbanization, and the aging of society have progressed,

various technological innovations for materials, engines, self-

driving cars using artificial intelligence, and so on, have been

developed and are soon to be put into practical use. In response

to this, user awareness has changed including a heightening

of safety and environmental consciousness and a progressive

shift from ownership of transport to use of transport. Against

this backdrop, diverse and innovative business models that go

beyond industry customs are appearing across industries, and

many business opportunities are expected to

arise from this trend.

Chemicals

Due to the shale revolution, the petrochemical industry in North

America has regained its competitiveness, and North America is

becoming a supply region comparable with the Middle East,

which has led to changes in the trade flow of petrochemicals.


Also due to restriction of capital and the environment in China

and geographical risk in the Middle East, more volatility in the

petrochemicals market could occur.

In the areas of performance and advanced materials as well

as specialty chemicals, growth areas are garnering in a global

macro environment consisting of a higher awareness toward the

environment, improved quality of life, and advances in techno-

logical innovations. These growth areas are automobiles, where

efforts to make vehicles lighter and electric powered such as

electric vehicles and fuel cell vehicles, are progressing; consumer

products, such as foods, detergents, and personal care products;

and ICT and new industries, which include electronic materials,

in addition to robotics and healthcare.

In the agricultural chemicals and food and nutrition science

areas, the need for increased food production and the demand

for high-value-added food are increasing significantly with

population and economic growth in global and the increase in

middle income earners and an improved awareness toward

health, which has led to market expansion.

Energy

Energy demand is expected to increase along with population

and economic growth around the world, and oil, natural gas, coal,

and nuclear fuel are expected to continue as main sources of

primary energy over the medium to long term. However, due to

the introduction of new policies to tackle climate change, there

are analysis and scenarios that show a plateau in the energy

demand for fossil fuel from around 2030 to 2040, and it is

important for us to build a strong portfolio of cost competitive

assets that can thrive under that environment.

As oil demand is expected to increase in the medium to long

term, the crude oil market is expected to follow a gentle uptrend,

mainly due to the effect of slowed-down development by

restrained new upstream investment and the necessity to

develop higher cost fields. On the other hand, we are aware of

the rapid growth in sales of EVs and compounded with the effect

of environmental regulations, the potential decrease in the

demand for oil needs to be carefully monitored.

The LNG market is expected to remain as an oversupply situa-

tion for the time being, because the pace of LNG demand

increase will not match with the supply increase by start-up of

new large-scale LNG projects in Australia, the U.S., and so on.

However, in the medium and long term, the oversupply situation

is expected to be resolved around the early 2020s due to the firm

demand increase mainly resulting from market expansion in

emerging countries and an environmental consideration.

In the upstream business, including E&P and LNG projects,

we are working to improve profitability by promoting proactive

initiatives and taking advantage of lower development costs

caused by lower commodity prices. We are also promoting the

development of undeveloped reserves and acquisition of good

quality assets, which will establish a more stable earnings base.

In addition, we will enhance our presence by reinforcing global

business and trading structure, and we will develop business

through our energy value chain from upstream to midstream

to downstream, further enhancing our earnings base and

improving the sustainable value-creating capabilities of our

business portfolio by capturing new demand arising in emerging

countries and opportunities in infrastructure business such as

power generation plants and terminals.

As a response to climate change, there has been a need for

a shift to cleaner energy and action taken toward contributing to

a low-carbon society. The growth rate of renewable energies,

centered primarily on solar power and wind power, is high due to

cost reduction by rapid technological innovation. Depending on

the growth rate, it could significantly affect the composition of

primary energy sources.

By assessing the trends in the energy business from a long-

term perspective, we intend to promote the establishment of a

well-balanced energy portfolio for the future, and to contribute to

the sustainable growth of society through comprehensive stable

energy supply.

Lifestyle

As the global population and economy grow, food demand

is expected to increase constantly. Meanwhile, against a

background of decreasing agricultural population primarily in

industrialized countries and changes to suitable agricultural

land due to climate change, the uneven distribution of food-

producing regions is progressing and the need to secure food

resources and stable food supplies is expected to become more

pressing. The global increase of the middle-income class leads to

the sophistication of food demand, such as preferences for taste,

animal protein, and so on. Additionally, the aging of society led

food demand to diversify in areas such as health improvement,

disease prevention, safety, security, and so on. The segment

believes that it is also necessary to address the demand for

high-value-added food.

In Japan’s mature consumer market, consumption is expected

to decline at a moderate pace due to a declining birthrate and a

population that is contracting and aging. The changes are not

only quantitative. Against a backdrop of changing lifestyles

accompanying the increase in the elderly population, and

increases in dual-income households and small families due to

more women having jobs, there are substantial changes in the

quality and contents of services required, such as an emphasis

on medical and healthcare services and the pursuit of safety,

security, and convenience.

In emerging countries, mainly in Asia, the growth of

medical expenditures is accelerating alongside changes in

disease patterns, such as an increase in chronic disease

patients, accompanying population growth, an aging society,

an increasing middle-income class, and economic development.

On the other hand, due to a shortage in the supply of medical

services, demand-supply gaps regarding medical services are

expected to expand further. The segment believes that it is

necessary to address the difficult issues of increasing the supply

of high-quality medical services and curtailing medical

expenditures.

Innovation & Corporate Development

In the ICT business area, with the evolution of AI, robotics and IoT,

the value of digital data is increasing drastically and it has given

more power of influence to consumers. Business environments

are changing rapidly, and as a result, there is a need to take swift

action as technological innovation, as well as new services and

business models, leads the way toward a next-generation society

in which advanced ICT technologies and the real economy are

closely linked.

In the Corporate Development business area, real estate asset

management business, combining the knowledge of the real

estate and finance businesses, is expanding in both developed

and emerging economies around the world, however, more

attention on the decrease of monetary easing initiatives and the

increase of policy interest rates should be paid. Furthermore,

buyout funds and other private equity funds, which provide

management know-how and funding, are playing an increasingly

important role in supporting corporate growth.


Millions of yen

(Assets) 2014 2015 2016 2017 2018

Current Assets

Cash and cash equivalents 1,226,317 1,400,770 1,490,775 1,503,820 1,131,380

Trade and other receivables 2,040,855 1,949,837 1,607,885 1,739,402 1,766,017

Other financial assets 271,288 384,156 295,064 267,680 243,915

Inventories 625,328 671,164 533,697 589,539 550,699

Advance payments to suppliers 183,576 188,545 220,711 225,442 307,339

Assets held for sale — — — — 108,920

Other current assets 118,049 136,051 138,563 148,865 117,886

Total current assets 4,465,413 4,730,523 4,286,695 4,474,748 4,226,156

Non-current Assets

Investments accounted for using the equity method

2,448,848 2,791,341 2,515,340 2,741,741 2,502,994

Other investments 1,554,673 1,529,767 1,179,696 1,337,164 1,825,026

Trade and other receivables 470,880 425,136 382,176 477,103 400,079

Other financial assets 116,298 130,974 159,384 145,319 153,149

Property, plant and equipment 2,007,452 2,148,142 1,938,448 1,823,492 1,729,897

Investment property 139,334 147,757 147,756 179,789 188,953

Intangible assets 144,153 162,951 157,450 168,677 173,207

Deferred tax assets 74,419 78,746 92,231 92,593 49,474

Other non-current assets 69,849 57,584 51,335 60,387 57,725

Total non-current assets 7,025,906 7,472,398 6,623,816 7,026,265 7,080,504

Total assets 11,491,319 12,202,921 10,910,511 11,501,013 11,306,660

Consolidated Statements of Financial PositionMitsui & Co., Ltd. and its subsidiaries

March 31, 2014, 2015, 2016, 2017 and 2018


Billions of yen

2017 2018 Increase or decrease

Total current assets 4,474.7 4,226.2 –248.5

Cash and cash equivalents 1,503.8 1,131.4 –372.4

Trade and other receivables 1,739.4 1,766.0 +26.6

Advance payments to suppliers 225.4 307.3 +81.9

Assets held for sale — 108.9 +108.9

Current Assets

◦ Cash and cash equivalents declined by ¥372.4 billion, mainly due to repayment of debt.

◦ Trade and other receivables increased by ¥26.6 billion, mainly because trading volume increased in the Energy Segment, prices and trading volume increased and March

31, 2018 fell under the financial institutions’ holiday in the Chemical Segment, despite the decrease due to the transfer to Assets held for sale.

◦ Advance payments to suppliers increased by ¥81.9 billion, mainly due to an increase in trading volume in the Machinery & Infrastructure Segment.

◦ Assets held for sale increased by ¥108.9 billion, because assets expected to be transferred from the Company and Mitsui & Co. Steel Ltd. to NIPPON STEEL & SUMIKIN

BUSSAN CORPORATION are presented as a single line item as of March 31, 2018.

Billions of yen


Total non-current assets 7,026.3 7,080.5 +54.2

Investments accounted for using the equity method

2,741.7 2,503.0 –238.7

Other investments 1,337.2 1,825.0 +487.8

Trade and other receivables 477.1 400.1 –77.0

Property, plant and equipment 1,823.5 1,729.9 –93.6

Investment property 179.8 189.0 +9.2

Deferred tax assets 92.6 49.5 –43.1

Non-current Assets

◦Investments accounted for using the equity method declined by ¥238.7 billion, mainly due to the following factors:

A decline of ¥250.8 billion corresponding to the incorporation of Valepar S.A. by Vale S.A.;

A decline of ¥73.6 billion resulting from foreign currency exchange fluctuations;

An increase of ¥234.9 billion corresponding to the profit of equity method investments for the current year, despite a decline of ¥285.9 billion due to dividends

received from equity accounted investees;

An increase of ¥48.3 billion due to an additional acquisition of a stake in Penske Truck Leasing Co., L.P., which is engaged in truck leasing and rental business in

North America;

An increase of ¥16.9 billion due to an investment in Cameron LNG Holdings, LLC, which is engaged in the natural gas liquefaction business in the U.S.; and

An increase of ¥15.1 billion due to an additional acquisition of a stake in International Columbia U.S. LLC, the holding company for Asia’s largest hospital group for

middle-income patients.

◦Other investments increased by ¥487.8 billion, mainly due to the following factors:

An increase of ¥307.1 billion corresponding to the incorporation of Valepar S.A. by Vale S.A.;

Fair value on financial assets measured at FVTOCI increased by ¥159.5 billion mainly due to higher share prices;

An increase of ¥14.2 billion due to an investment in the Russian pharmaceutical company JSC R-Pharm; and

An increase of ¥10.2 billion due to an additional acquisition of shares in NIPPON STEEL & SUMIKIN BUSSAN CORPORATION.

◦Trade and other receivables (non-current) declined by ¥77.0 billion, mainly due to the following factors:

A decline of ¥28.0 billion due to collection of loan to the IPP business in Indonesia;

A decline of ¥19.4 billion due to collection of loan to SUMIC Nickel Netherlands, an investment company for overseas Nickel businesses;

A decline of ¥16.9 billion mainly due to reclassification of partial subsidiaries under Mitsui Rail Capital Participações Ltda., the holding company for freightcar leasing

and management business in Brazil, to equity accounted investees;

A decline of ¥13.6 billion due to recording allowance for doubtful receivables against the loan to SCM Minera Lumina Copper Chile, the project company for the

Caserones Copper Mine;

An increase of ¥19.3 billion due to execution of loan to Gestamp Automoción S.A.’s North American operations; and

An increase of ¥13.4 billion due to execution of loan to the offshore energy business.

◦Property, plant and equipment declined by ¥93.6 billion, mainly due to the following factors:

A decline of ¥34.0 billion at U.S. shale gas and oil producing operations mainly due to partial sale of interest in the Marcellus Shale Gas Project (including a foreign

exchange translation loss of ¥8.1 billion);

A decline of ¥30.5 billion (including a foreign exchange translation loss of ¥16.3 billion) at iron ore mining operations in Australia;

A decline of ¥30.1 billion (including a foreign exchange translation loss of ¥15.3 billion) at oil and gas operations other than U.S. shale gas and oil producing

operations; and

An increase of ¥10.5 billion for the integrated development project in the 2, Ohtemachi 1-Chome District.

◦ Investment property increased by ¥9.2 billion, mainly due to an increase of ¥13.8 billion for the integrated development project in the 2, Ohtemachi 1-Chome District.

◦Deferred tax assets declined by ¥43.1 billion, mainly due to a reduction in the corporate tax rate following the U.S. tax reform.

Analysis of Changes in Assets


Consolidated Statements of Financial Position

Millions of yen

(Liabilities and Equity) 2014 2015 2016 2017 2018

Current Liabilities

Short-term debt 436,869 290,641 353,203 304,563 201,556

Current portion of long-term debt 505,946 472,718 519,161 388,347 482,550

Trade and other payables 1,473,834 1,384,039 1,107,238 1,203,707 1,264,285

Other financial liabilities 301,047 414,011 298,329 315,986 300,284

Income tax payables 42,857 41,877 22,309 52,177 62,546

Advances from customers 165,124 177,432 207,419 212,142 287,779

Provisions 17,491 25,523 14,959 13,873 28,036

Liabilities directly associated with assets held for sale

— — — — 40,344

Other current liabilities 41,486 34,900 40,161 33,172 31,392

Total current liabilities 2,984,654 2,841,141 2,562,779 2,523,967 2,698,772

Non-current Liabilities

Long-term debt, less current portion 3,468,301 4,030,598 3,838,156 4,108,674 3,542,829

Other financial liabilities 95,541 147,289 109,520 111,289 103,162

Retirement benefit liabilities 69,558 46,211 78,176 60,358 50,872

Provisions 174,855 228,540 219,330 196,718 200,649

Deferred tax liabilities 567,281 482,141 409,695 481,358 467,003

Other non-current liabilities 30,825 29,627 26,319 28,487 25,250

Total non-current liabilities 4,406,361 4,964,406 4,681,196 4,986,884 4,389,765

Total liabilities 7,391,015 7,805,547 7,243,975 7,510,851 7,088,537

Equity

Common stock 341,482 341,482 341,482 341,482 341,482

Capital surplus 418,004 411,881 412,064 409,528 386,165

Retained earnings 2,345,790 2,537,815 2,314,185 2,550,124 2,903,432

Other components of equity 766,631 814,563 317,955 485,447 448,035

Treasury stock (56,140) (5,946) (5,961) (54,402) (104,399)

Total equity attributable to owners of the parent

3,815,767 4,099,795 3,379,725 3,732,179 3,974,715

Non-controlling interests 284,537 297,579 286,811 257,983 243,408

Total equity 4,100,304 4,397,374 3,666,536 3,990,162 4,218,123

Total liabilities and equity 11,491,319 12,202,921 10,910,511 11,501,013 11,306,660


Analysis of Changes in LiabilitiesBillions of yen


Total current liabilities 2,524.0 2,698.8 +174.8

Short-term debt 304.6 201.6 –103.0

Current portion of long-term debt 388.3 482.6 +94.3

Trade and other payables 1,203.7 1,264.3 +60.6

Advances from customers 212.1 287.8 +75.7

Liabilities directly associated with assets held for sale

— 40.3 +40.3

Current Liabilities

◦ Short-term debt declined by ¥103.0 billion, mainly due to repayment of debt. Meanwhile, the current portion of long-term debt increased by ¥94.3 billion, mainly due to

reclassification to current maturities, despite repayment of debt.

◦ Trade and other payables increased by ¥60.6 billion, corresponding to the increase in trade and other receivables. Furthermore, advances from customers increased by

¥75.7 billion, corresponding to the increase in advance payments to suppliers.

◦ Liabilities directly associated with assets held for sale increased by ¥40.3 billion, because liabilities expected to be transferred from the Company and Mitsui & Co. Steel Ltd.

to NIPPON STEEL & SUMIKIN BUSSAN CORPORATION are presented as a single line item as of March 31, 2018.

Billions of yen


Total non-current liabilities 4,986.9 4,389.8 –597.1

Long-term debt, less current portion 4,108.7 3,542.8 –565.9

Provisions 196.7 200.6 +3.9

Deferred tax liabilities 481.4 467.0 –14.4

Non-current Liabilities

◦ Long-term debt, less the current portion, declined by ¥565.9 billion, mainly due to reclassification to current maturities, repayment of debt and reclassification of partial

subsidiaries under Mitsui Rail Capital Participações Ltda., the holding company for freightcar leasing and management in Brazil, to equity accounted investees.

◦ Provisions increased by ¥3.9 billion, mainly due to recording of a provision related to Multigrain business, despite the decrease of the asset retirement obligation by ¥19.0

billion at oil and gas operations other than U.S. shale gas and oil producing operations.

◦ Deferred tax liabilities declined by ¥14.4 billion, mainly due to the reversal of deferred tax liability for the retained earnings of Valepar S.A. corresponding to the

incorporation of Valepar S.A. by Vale S.A., the reversal of deferred tax liability on undistributed profits corresponding to receipt of dividends from the equity accounted

investees which are engaged in the IPP business, and a reduction in the corporate tax rate following the U.S. tax reform, despite the increase in financial assets measured

at FVTOCI corresponding to higher share prices.

Analysis of Changes in EquityBillions of yen


Total equity 3,990.2 4,218.1 +227.9

Capital surplus 409.5 386.2 –23.3

Retained earnings 2,550.1 2,903.4 +353.3

Other components of equity 485.4 448.0 –37.4

Treasury stock (54.4) (104.4) –50.0

Non-controlling interests 258.0 243.4 –14.6

◦ Capital surplus declined by ¥23.3 billion mainly due to the decrease corresponding to an additional acquisition of a stake in Japan Collahuasi Resources, the holding

company for Compañía Minera Doña Inés de Collahuasi, which is a copper mining company in Chile.

◦ Retained earnings increased by ¥353.3 billion.

◦ Other components of equity declined by ¥37.4 billion, mainly due to the following factors:

Financial assets measured at FVTOCI increased by ¥102.8 billion, mainly due to higher share prices.

Foreign currency translation adjustments declined by ¥146.6 billion, mainly reflecting the appreciation of the Japanese yen against the

U.S. dollar, the Australian dollar, and the Brazilian real.

◦ Treasury stock, which is a subtraction item in shareholders’ equity, increased by ¥50.0 billion due to share buyback.

◦ Non-controlling interests declined by ¥14.6 billion mainly due to an additional acquisition of a stake in Japan Collahuasi Resources, the holding company for Compañía

Minera Doña Inés de Collahuasi, which is a copper mining company in Chile.


Millions of yen

2014 2015 2016 2017 2018

Revenue:

Sale of products 5,206,772 4,815,162 4,202,593 3,833,564 4,330,823

Rendering of services 415,395 432,112 399,937 405,893 436,606

Other revenue 109,751 157,656 157,164 124,512 124,720

Total revenue 5,731,918 5,404,930 4,759,694 4,363,969 4,892,149

Cost:

Cost of products sold (4,627,572) (4,310,657) (3,807,456) (3,418,437) (3,856,008)

Cost of services rendered (162,690) (181,528) (161,910) (171,741) (186,093)

Cost of other revenue (61,550) (66,905) (63,706) (54,496) (59,343)

Total cost (4,851,812) (4,559,090) (4,033,072) (3,644,674) (4,101,444)

Gross profit 880,106 845,840 726,622 719,295 790,705

Other Income (Expenses):

Selling, general and administrative expenses (574,871) (584,608) (566,014) (538,975) (571,703)

Gain (loss) on securities and other

investments–net 30,816 42,458 93,168 64,962 55,146

Impairment reversal (loss) of fixed assets–net (59,966) (79,948) (88,964) (5,732) (25,454)

Gain (loss) on disposal or sales of fixed

assets–net16,419 1,446 (11,684) 11,013 15,108

Provision related to Multigrain business — — — — (25,006)

Other income (expense)–net (21,720) (34,918) (32,092) 9,877 15,826

Total other income (expenses) (609,322) (655,570) (605,586) (458,855) (536,083)

Finance Income (Costs):

Interest income 33,644 33,120 31,612 34,905 36,516

Dividend income 124,026 114,070 54,675 51,874 84,793

Interest expense (49,176) (50,229) (50,961) (56,997) (66,488)

Total finance income 108,494 96,961 35,326 29,782 54,821

Share of Profit (Loss) of Investments Accounted

for Using the Equity Method171,239 144,596 (132,033) 170,569 234,941

Profit before Income Taxes 550,517 431,827 24,329 460,791 544,384

Income Taxes (176,654) (104,903) (91,243) (134,641) (103,082)

Profit (Loss) for the Year 373,863 326,924 (66,914) 326,150 441,302

Profit (Loss) for the Year Attributable to:

Owners of the parent 350,093 306,490 (83,410) 306,136 418,479

Non-controlling interests 23,770 20,434 16,496 20,014 22,823

Comprehensive Income:

Profit (loss) for the year 373,863 326,924 (66,914) 326,150 441,302

Other Comprehensive Income:

Items That Will Not Be Reclassified to Profit or

Loss:

Financial assets measured at FVTOCI 76,202 (57,039) (315,232) 198,971 174,983

Remeasurements of defined benefit

pension plans(9,676) 20,045 (33,191) 16,379 14,242

Share of other comprehensive income of

investments accounted for using the equity

method

622 (3,612) (1,739) (3,132) 4,372

Income tax relating to items not reclassified (12,915) 42,045 81,316 (54,549) (48,857)

Items That May Be Reclassified Subsequently to

Profit or Loss:

Foreign currency translation adjustments 19,961 32,509 (118,214) 25,787 (82,590)

Cash flow hedges 9,623 (15,889) 1,347 14,985 6,184

Share of other comprehensive income of

investments accounted for using the equity

method

103,182 74,115 (153,984) (6,528) (42,390)

Income tax relating to items that may be

reclassified(3,889) 20,174 (5,490) 7,094 (32,649)

Total other comprehensive income 183,110 112,348 (545,187) 199,007 (6,705)

Comprehensive Income for the Year 556,973 439,272 (612,101) 525,157 434,597

Comprehensive Income for the Year Attributable to:

Owners of the parent 521,457 406,583 (607,490) 503,025 416,113

Non-controlling interests 35,516 32,689 (4,611) 22,132 18,484

Consolidated Statements of Income

and Comprehensive IncomeMitsui & Co., Ltd. and its subsidiaries

Years ended March 31, 2014, 2015, 2016, 2017 and 2018


Analysis of Changes in Profit for the Year Attributable to Owners of the ParentBillions of yen


Profit for the year attributable to owners of the parent 306.1 418.5 +112.4

Gross profit 719.3 790.7 +71.4

Share of profit (loss) of investments accounted for using the equity method

170.6 234.9 +64.3

Dividend income 51.9 84.8 +32.9

Selling, general and administrative expenses (539.0) (571.7) –32.7

Others (96.7) (120.2) –23.5

Gross profit Mainly the Energy Segment and the Mineral & Metal Resources Segment reported an increase in gross profit, while the Chemicals Segment recorded a decline.

◦Energy +32.9 (MOECO +17.1, MEPUSA +9.7, MEPTX +4.9, MEPME +4.5, MEPAU +4.4, WPI –3.7)

◦Mineral & Metal Resources +30.0 (Iron ore in Australia +13.6, Coal in Australia +12.3)

◦Chemicals –9.0 (Novus –16.9)

Share of profit (loss) of investments accounted for using the equity method Mainly the Machinery & Infrastructure Segment, the Mineral & Metal Resources Segment, the

Energy Segment, and the Chemicals Segment recorded an increase.

◦Machinery & Infrastructure +32.2 (IPP +37.8 (Sales of the interests in UK IPP +20.3, Refinance of IPP +3.9, Improvement of MtM +2.6, Mar-17: Impairment

loss on intangible asset, Loss on closure of a power plant in Australia, Decline of tax burden, etc.), PAG +4.8, Deterioration

of overseas project, Reserve for Latin America loan –5.1, Impairment loss on overseas rail business, etc.)

◦Mineral & Metal Resources +13.3 (Acrux +11.7, Collahuasi +5.1, Valepar –9.6, etc.)

◦Energy +7.4 (JALMIMI, etc.)

◦Chemicals +7.4 (Miscellaneous)

Dividend income Mainly the Energy Segment and the Mineral & Metal Resources Segment reported an increase.

◦Energy +19.3 (Six LNG projects +19.7)

◦Mineral & Metal Resources +14.4 (Vale +8.7)

Selling, general and administrative expenses Primarily increases in personnel expenses and provision for doubtful receivables

Others

◦ The following table shows the details of Gain (loss) on securities and other investments–net, Impairment reversal (loss) of fixed assets–net, Gain (loss) on disposal or

sales of fixed assets–net, Other income (expense)–net, and Provision related to Multigrain business.

Billions of yen

2017 2018Increase or

decrease2017 breakdown 2018 breakdown

Gain (loss) on

securities and other

investments–net

65.0 55.1 –9.9 Mineral & Metal Resources:

Gain on deconsolidation of Sims +26.9

Lifestyle:

Partial sale of IHH shares +14.6

Machinery & Infrastructure:

Sale of wind power generation

business in Australia +5.8

Sale of a stake in aviation business +4.1

Innovation & Corporate Development:

Valuation gain on Hutchison China

MediTech +4.8

Mineral & Metal Resources:

Incorporation of Valepar +56.3


Gain on sale of an equity accounted

investment, UK IPP holding

company –3.5

Lifestyle:

Impairment [DaVita] –5.9


Impairment [Naaptol] –3.1

Impairment

reversal (loss) of

fixed assets–net

(5.7) (25.5) –19.8 Miscellaneous Lifestyle:

Impairment at Xingu –11.3


Container terminal –5.4

Energy:

Exploration expenses –4.9

Gain (loss) on

disposal or sales of

fixed assets–net

11.0 15.1 +4.1 Lifestyle:

Sales of buildings in Japan

Lifestyle:

Sales of buildings in Japan


Sales of warehouses in Japan

Other income

(expense)–net

9.9 15.8 +5.9 Machinery & Infrastructure:

Receipt of IPP adjustment fees

Energy/Mineral and Metal Resources:


Iron & Steel Products:

Gestamp price adjustment clause +4.8

Energy/Mineral and Metal Resources:


Provision related to

Multigrain business

— (25.0) –25.0 Lifestyle:

Loss related to Multigrain

◦The reasons for changes in income tax amounts are as follows.

For the current year, deferred tax liabilities on the investment into Valepar S.A. were reversed. Furthermore, deferred tax liabilities on equity accounted investments

were reversed upon receiving dividends from those investees, and deferred tax liabilities were reversed due to the U.S. tax reform. On the other hand, income taxes

for the current year increased as profit before income taxes for the current year increased by ¥83.6 billion, and deferred tax assets on equity accounted investments

as well as Multigrain Trading AG were reversed.

The effective tax rate for the current year was 18.9%, a decline of 10.3% from 29.2% for the previous year. The aforementioned reversal of deferred tax liabilities

resulted in the decline, while the reversal of deferred tax assets caused an increase.


Millions of yen

2014 2015 2016 2017 2018

Operating Activities:

Profit (loss) for the year 373,863 326,924 (66,914) 326,150 441,302

Adjustments to reconcile profit for the year to

cash flows from operating activities:

Depreciation and amortization 219,147 268,367 253,168 193,329 192,587

Change in retirement benefit liabilities 1,121 (3,787) 336 (637) 4,326

Provision for doubtful receivables 10,215 17,041 9,916 9,172 20,331

Provision related to Multigrain business — — — — 25,006

(Gain) loss on securities and other

investments–net (30,816) (42,458) (93,168) (64,962) (55,146)

Impairment (reversal) loss of fixed

assets–net 59,966 79,948 88,964 5,732 25,454

(Gain) loss on disposal or sales of fixed

assets–net (16,419) (1,446) 11,684 (11,013) (15,108)

Finance (income) costs (101,451) (86,694) (26,571) (22,967) (50,911)

Income taxes 176,654 104,903 91,243 134,641 103,082

Share of (profit) loss of investments

accounted for using the equity method (171,239) (144,596) 132,033 (170,569) (234,941)

Valuation (gain) loss related to contingent

considerations and others— — — — (5,230)

Changes in operating assets and liabilities:

Change in trade and other receivables (44,457) 151,918 338,168 (121,022) (198,407)

Change in inventories (13,508) (161) 107,124 (60,272) 9,813

Change in trade and other payables (51,883) (52,092) (228,258) 111,917 99,814

Other–net (49,831) (121,317) (101,746) (21,298) (24,062)

Interest received 26,817 38,291 34,395 30,085 33,935

Interest paid (51,283) (49,906) (51,232) (65,352) (69,935)

Dividends received 277,305 291,593 220,160 194,698 376,422

Income taxes paid (164,958) (136,561) (132,311) (63,461) (124,687)

Cash flows from operating activities 449,243 639,967 586,991 404,171 553,645

Investing Activities:

Change in time deposits 707 (4,736) 369 (8,936) 8,368

Net change in investments in and advances

to equity accounted investees*— — — (155,423) (114,955)

Net change in investments to equity

accounted investees*(204,757) (155,355) (126,378) — —

Net change in other investments (96,918) 60,075 (23,424) 72,167 (23,523)

Net change in loan receivables* — — — (109,069) 25,731

Net change in long-term loan receivables* (1,963) 60,046 14,097 — —

Net change in property, plant, and equipment* — — — (149,568) (135,714)

Net change in investment property* — — — (2,470) (8,078)

Net change in property, plant, and equipment

and investment property*(356,887) (346,427) (272,723) — —

Cash flows from investing activities (659,818) (386,397) (408,059) (353,299) (248,211)

Financing Activities:

Net change in short-term debt (85,141) (181,841) 79,839 (48,983) (99,045)

Net change in long-term debt 208,986 197,233 (15,211) 196,801 (351,218)

Purchase and sales of treasury stock–net (50,216) (23) (14) (48,647) (49,992)

Dividends paid (83,970) (118,323) (114,737) (102,187) (105,844)

Transactions with non-controlling interest

shareholders(2,896) (23,239) (425) (47,249) (46,193)

Cash flows from financing activities (13,237) (126,193) (50,548) (50,265) (652,292)

Effect of exchange rate changes on cash and cash

equivalents 17,595 47,076 (38,379) 12,438 (24,529)

Effect of cash and cash equivalents included in assets

held for sale— — — — (1,053)

Change in cash and cash equivalents (206,217) 174,453 90,005 13,045 (372,440)

Cash and cash equivalents at beginning of year 1,432,534 1,226,317 1,400,770 1,490,775 1,503,820

Cash and cash equivalents at end of year 1,226,317 1,400,770 1,490,775 1,503,820 1,131,380

Certain reclassifications and format changes have been made to amounts of the Consolidated Statements of Cash Flows for the fiscal year ended March 31, 2017 to conform

to the current period’s presentation. Certain reclassifications and format changes have not been made to amounts for the fiscal years ended March 31, 2014, 2015, and 2016.

Consolidated Statements of Cash FlowsMitsui & Co., Ltd. and its subsidiaries



Analysis of Changes in Cash Flows from Operating ActivitiesBillions of yen


Cash flows from operating activities a 404.2 553.6 +149.4

Cash flows from change in working capital b (90.6) (112.9) –22.3

Core operating cash flow a–b 494.8 666.5 +171.7

◦ Net cash from an increase or a decrease in working capital, or changes in operating assets and liabilities for the current year was ¥112.9 billion of net cash outflow mainly

due to the effects of Other–net. Core operating cash flow, cash flows from operating activities without the net cash flow from an increase or a decrease in working capital,

for the current year amounted to ¥666.5 billion.

Net cash inflow from dividend income, including dividends received from equity accounted investees, for the current year totaled ¥376.4 billion, an increase of ¥181.7

billion from ¥194.7 billion for the previous year.

Depreciation and amortization for the current year was ¥192.6 billion, a decline of ¥0.7 billion from ¥193.3 billion for the previous year.

The following table shows core operating cash flow by operating segment.

Billions of yen


Iron & Steel Products 8.6 14.2 +5.6

Mineral & Metal Resources 202.1 240.8 +38.7

Machinery & Infrastructure 74.4 158.8 +84.4

Chemicals 53.8 50.2 –3.6

Energy 134.1 175.3 +41.2

Lifestyle 8.4 7.1 –1.3

Innovation & Corporate Development 6.1 3.1 –3.0

All other and adjustments and eliminations 7.3 17.0 +9.7

Consolidated total 494.8 666.5 +171.7

Cash Flows from Investing Activities for the Fiscal Year Ended March 31, 2018◦ Net cash outflows that corresponded to investments in equity accounted investees (net of sales of investments in equity accounted investees) were ¥115.0 billion,

mainly due to the following factors:

An additional acquisition of a stake in Penske Truck Leasing Co., L.P., which is engaged in the truck leasing and rental business in North America, for ¥48.3 billion;

An investment in Cameron LNG Holdings, LLC, which is engaged in the natural gas liquefaction business in the U.S., for ¥16.9 billion;

An investment in CIM Group, LLC for ¥10.1 billion;

A sale of a stake in relation to the water concession business in Czech Republic; and

A partial sale of an equity accounted investment for ¥10.9 billion.

◦ Net cash outflows that corresponded to other investments (net of sales and maturities of other investments) were ¥23.5 billion, mainly due to the following factors:

An investment in the Russian pharmaceutical company JSC R-Pharm for ¥22.0 billion;

An acquisition of a healthcare staffing project in the U.S. for ¥13.3 billion;

An additional acquisition of shares in NIPPON STEEL & SUMIKIN BUSSAN CORPORATION for ¥10.2 billion; and

A sale of a stake in Champions Cinco Pipe & Supply LLC, oil and gas well tubular business.

◦ Net cash inflows that corresponded to collections of loan receivables (net of increases in loan receivables) were ¥25.7 billion, mainly due to the following factors:

Collection of loan to the IPP business in Indonesia for ¥28.0 billion;

Collection of loan to SUMIC Nickel Netherlands, an investment company for overseas Nickel businesses for ¥19.4 billion;

Collection of loan corresponding to the sales of the interest in UK First Hydro power assets for ¥18.4 billion;

Execution of loan to Gestamp Automoción S.A.’s North American operations for ¥19.3 billion; and

Execution of loan to the offshore energy business for ¥13.4 billion.

◦ Net cash outflows that corresponded to purchases of property, plant, and equipment (net of sales of those assets) were ¥135.7 billion, mainly due to the following factors:

An expenditure for the oil and gas projects other than the U.S. shale gas and oil projects for a total of ¥64.1 billion;

An expenditure for iron ore mining operations in Australia for ¥15.0 billion;

An expenditure for coal mining operations in Australia for ¥13.9 billion;

An expenditure for the U.S. shale gas and oil projects for ¥11.5 billion;

An expenditure for the integrated development project in the 2, Ohtemachi 1-Chome District for ¥10.5 billion; and

A partial sale of interest in the Marcellus Shale Gas Project for ¥15.8 billion.

◦ Net cash outflows that corresponded to sales of investment property (net of purchases of investment property) were ¥8.1 billion, mainly due to the following factors:

An expenditure for the integrated development project in the 2, Ohtemachi 1-Chome District for ¥13.8 billion; and

A sale of buildings in Japan by Mitsui & Co. Real Estate Ltd. for ¥10.5 billion.

Cash Flows from Financing Activities for the Fiscal Year Ended March 31, 2018◦ Net cash outflows from net change in short-term debt and long-term debt were ¥99.0 billion and ¥351.2 billion, respectively, mainly due to the repayment of debt.

◦ The cash outflow from the purchases of treasury stock was ¥50.0 billion.

◦ The cash outflow from payments of cash dividends was ¥105.8 billion.

◦ The cash outflow from transactions with non-controlling interest shareholders was ¥46.2 billion, mainly due to an additional acquisition of a stake in Japan Collahuasi

Resources, the holding company for Compañía Minera Doña Inés de Collahuasi, which is a copper mining company in Chile.


Year ended March 31, 2014 (April 1, 2013 to March 31, 2014) Millions of yen

Iron & Steel

Products

Mineral & Metal

Resources

Machinery &


Innovation

& Corporate

Development

Revenue 220,068 791,197 410,155 943,198 1,454,254 890,587 103,215

Gross profit 51,130 200,892 114,743 80,527 199,834 113,979 22,579

Share of profit (loss) of investments

accounted for using the equity method5,395 37,990 24,400 8,606 60,087 19,289 4,879

Profit (loss) for the year 14,583 88,052 17,146 8,370 188,441 12,096 (12,258)

EBITDA 21,839 241,785 35,642 28,514 416,106 20,203 (23,614)

Total Assets at March 31, 2014 567,741 1,970,858 1,872,585 765,751 2,478,158 1,495,387 496,533

Americas EMEA Asia Pacific Total All Other

Adjustments

and

Eliminations

Consolidated

Total

Revenue 699,622 108,663 109,079 5,730,038 1,884 (4) 5,731,918

Gross profit 78,725 18,752 12,469 893,630 794 (14,318) 880,106


accounted for using the equity method4,039 1,384 4,525 170,594 365 280 171,239

Profit (loss) for the year 13,668 397 30,682 361,177 11,004 (22,088) 350,093

EBITDA 26,334 499 (347) 766,961 7,756 44,930 819,647

Total Assets at March 31, 2014 568,772 105,907 345,074 10,666,766 5,037,172 (4,212,619) 11,491,319


Iron & Steel

Products

Mineral & Metal

Resources

Machinery &


Innovation

& Corporate

Development

Revenue 151,442 791,211 443,946 888,222 991,247 975,991 120,167

Gross profit 37,970 146,125 130,131 70,134 202,739 116,242 37,420


accounted for using the equity method7,641 913 32,988 7,225 56,610 21,642 5,748

Profit (loss) for the year 8,460 60,857 45,680 3,702 119,674 (2,695) 6,006

EBITDA 12,909 155,530 54,977 18,074 439,849 16,156 (4,991)



Adjustments

and

Eliminations

Consolidated

Total

Revenue 828,521 110,161 102,179 5,403,087 1,843 — 5,404,930

Gross profit 92,589 19,317 12,223 864,890 701 (19,751) 845,840


accounted for using the equity method7,450 574 4,518 145,309 — (713) 144,596

Profit (loss) for the year 25,757 3,408 30,535 301,384 8,947 (3,841) 306,490

EBITDA 41,297 (541) (2,528) 730,732 3,221 54,312 788,265



Iron & Steel

Products

Mineral & Metal

Resources

Machinery &


Innovation

& Corporate

Development

Revenue 111,082 685,557 415,198 787,370 672,638 990,438 139,473

Gross profit 31,951 98,672 127,085 76,453 108,952 116,506 52,884


accounted for using the equity method4,842 (204,064) 8,045 7,956 (22,257) 18,547 7,825

Profit (loss) for the year 6,328 (162,480) 18,308 17,711 (3,885) (13,996) 16,128

EBITDA 10,945 (93,802) 29,239 30,089 210,119 9,938 12,491



Adjustments

and

Eliminations

Consolidated

Total

Revenue 785,574 105,267 111,402 4,803,999 2,606 (46,911) 4,759,694

Gross profit 114,831 20,530 23,259 771,123 1,664 (46,165) 726,622


accounted for using the equity method8,215 3,700 35,493 (131,698) 57 (392) (132,033)

Profit (loss) for the year 28,301 3,474 11,552 (78,559) 7,429 (12,280) (83,410)

EBITDA 69,371 5,262 40,850 324,502 (490) 12,406 336,418


Segment InformationMitsui & Co., Ltd. and its subsidiaries




Iron & Steel

Products

Mineral & Metal

Resources

Machinery &


Innovation

& Corporate

Development

Revenue 202,406 746,406 408,504 1,037,284 463,601 1,378,263 125,226

Gross profit 36,724 176,786 114,452 145,611 63,885 136,179 44,988



Profit (loss) for the year 10,853 144,314 66,806 32,653 31,679 25,382 10,975

Core operating cash flow 8,617 202,136 74,432 53,771 134,109 8,378 6,109

Total Assets at March 31, 2017 612,632 1,962,236 2,238,142 1,175,205 1,905,252 1,723,399 611,395

Total All Other

Adjustments

and

Eliminations

Consolidated

Total

Revenue 4,361,690 1,908 371 4,363,969

Gross profit 718,625 299 371 719,295


accounted for using the equity method171,070 (106) (395) 170,569

Profit (loss) for the year 322,662 (2,888) (13,638) 306,136

Core operating cash flow 487,552 16,394 (9,100) 494,846

Total Assets at March 31, 2017 10,228,261 5,798,648 (4,525,896) 11,501,013


Iron & Steel

Products

Mineral & Metal

Resources

Machinery &


Innovation

& Corporate

Development

Revenue 238,240 946,369 447,088 1,186,673 534,293 1,409,378 127,326

Gross profit 41,874 206,767 121,943 136,573 96,808 139,533 45,084



Profit (loss) for the year 24,728 257,617 89,617 34,235 48,601 (26,340) (4,637)

Core operating cash flow 14,179 240,829 158,846 50,174 175,282 7,118 3,061

Total Assets at March 31, 2018 654,725 2,092,908 2,255,650 1,186,254 1,917,687 1,901,822 622,709

Total All Other

Adjustments

and

Eliminations

Consolidated

Total

Revenue 4,889,367 1,937 845 4,892,149

Gross profit 788,582 1,278 845 790,705


accounted for using the equity method235,424 (116) (367) 234,941

Profit (loss) for the year 423,821 2,469 (7,811) 418,479

Core operating cash flow 649,489 8,558 8,440 666,487

Total Assets at March 31, 2018 10,631,755 6,239,888 (5,564,983) 11,306,660


Segment Information

Notes: 1. “All Other” principally consisted of the Corporate Staff Unit, which provides financing services and operations services to external customers and/or to the

Company and affiliated companies. Total assets of “All Other” at March 31, 2014, 2015, 2016, 2017 and 2018 consisted primarily of cash and cash equivalents and

time deposits related to financing activities, and assets of the Corporate Staff Unit and certain subsidiaries related to the above services.

2. Transfers between reportable segments are made at cost plus a markup.

3. The amounts in “Adjustments and Eliminations” for Profit (Loss) for the Year Attributable to Owners of the Parent include income and expense items that are not

allocated to specific reportable segments, and eliminations of intersegment transactions.

4. In the fiscal year ended March 31, 2015, we introduced EBITDA as a measure of underlying earnings power in addition to profit (loss) attributable to owners of

the parent as a base indicator to measure performance. However, due to the fact that EBITDA includes impairment losses recorded by major equity accounted

investees, we determined that core operating cash flow was a more appropriate indicator for measuring our ability to generate cash flow. Accordingly, as of the

fiscal year ended March 31, 2018, we no longer use EBITDA to measure performance and instead use core operating cash flow.

5. Segment information for the fiscal years ended March 31, 2014, 2015, and 2016 has not been revised and restated in relation to paragraph 29 of IFRS 8.

Also, the profit and loss results for the fiscal years below have been revised and restated in compliance with legal disclosure requirements.

• No revisions and restatements were made for results between the fiscal year ended March 31, 2014 and the fiscal year ended March 31, 2015.

• Revisions and restatements were made for results between the fiscal year ended March 31, 2015 and the fiscal year ended March 31, 2016 to reflect the

following changes.

Previously, profit of the jointly invested subsidiaries by several Company segments was allocated from the main segment to sub-segments using profit

attributable to non-controlling interests. However, in order to disclose each operating segment’s EBITDA more appropriately, since the fiscal year ended

March 31, 2016, profits and losses associated with EBITDA have been allocated by using share of profit of investments accounted for using the equity method.

In order to disclose each operating segment’s total assets more appropriately, since the fiscal year ended March 31, 2016, total assets of the jointly invested

subsidiaries have been allocated based on internal profit share as of the fiscal year ended March 31, 2016.

• Revisions and restatements were made for results between the fiscal year ended March 31, 2016 and the fiscal year ended March 31, 2017 to reflect the

following changes.

In the fiscal year ended March 31, 2017, the Food Science Business was transferred from the Lifestyle Segment to the Chemicals Segment in conjunction with

the establishment of the Nutrition & Agriculture Business Unit.

In the fiscal year ended March 31, 2017, the United Grain Corporation of Oregon, which was formerly included in the Americas Segment, was transferred to

the Lifestyle Segment with the aim of optimizing the Group’s global grain trading strategy.

6. In accordance with the changes below, the segment information for the fiscal year ended March 31, 2017 has been restated to conform to the current period’s

presentation.

• Since the fiscal year ended March 31, 2018, the previous 10 reportable segments that include 7 product segments of “Iron & Steel Products,” “Mineral & Metal

Resources,” “Machinery & Infrastructure,” “Chemicals,” “Energy,” “Lifestyle” and “Innovation & Corporate Development” along with 3 regional segments of

“Americas”, “Europe, the Middle East and Africa” and “Asia Pacific,” have been changed to 7 reportable segments of “Iron & Steel Products,” “Mineral & Metal

Resources,” “Machinery & Infrastructure,” “Chemicals,” “Energy,” “Lifestyle” and “Innovation & Corporate Development,” where the regional segments were

consolidated by product segment. In addition, part of each of the regional segments have been consolidated into “All Other.”

• Previously, there was a difference between the Company’s actual income taxes and the reportable segments’ income taxes that were calculated using the internal

tax rate, and the difference was included in “Adjustments and Eliminations.” Since the fiscal year ended March 31, 2018, the internal tax rate has been made the

same as the external tax rate. In addition, since the fiscal year ended March 31, 2018, the scope of allocation of expenses incurred at the Corporate Staff Unit to

reportable segments was reviewed, and part of the expenses which were previously allocated to the reportable segments have been excluded from the scope

of allocation.

• Previously, the profit and loss of consolidated subsidiaries that are jointly held by numerous operating segments were allocated from the supervising to the

non-supervising operating segments based on the profit share of each of the segments using the Share of Profit (Loss) of Investments Accounted for Using the

Equity Method and Income for the Period Attributable to Non-controlling Interests. Since the fiscal year ended March 31, 2018, these allocations have been

made based on the profit share of each of the segments in each of the accounts disclosed in the segment information to reflect the performance of the

operating segments more properly.


Millions of yen

2014 2015 2016 2017 2018

Attributable to owners of the parent

Common stock

Balance at beginning of year 341,482 341,482 341,482 341,482 341,482

Balance at end of year 341,482 341,482 341,482 341,482 341,482

Capital surplus


Equity transactions with non-controlling interest shareholders

(10,548) (6,338) 2 (2,700) (23,581)

Compensation costs related to stock options

— 215 181 164 247

Sale of treasury stock — — — — (29)


Retained earnings

Balance at beginning of year 2,060,298 2,345,790 2,537,815 2,314,185 2,550,124

Profit (loss) for the year attributable to owners of the parent

350,093 306,490 (83,410) 306,136 418,479

Transfer from other components of equity

19,356 54,031 (25,498) 31,990 40,703

Dividends paid to the owners of the parent

(83,957) (118,305) (114,722) (102,187) (105,844)

Sale of treasury stock 0 0 (0) (0) (30)

Cancellation of treasury stock — (50,191) — — —

Balance at end of year 2,345,790 2,537,815 2,314,185 2,550,124 2,903,432

Other components of equity


Other comprehensive income for the year

171,364 100,093 (524,080) 196,889 (2,366)

Transfer to retained earnings (19,356) (54,031) 25,498 (31,990) (40,703)


(160) 1,870 1,974 2,593 5,657


Treasury stock

Balance at beginning of year (5,974) (56,140) (5,946) (5,961) (54,402)

Acquisition of treasury stock (50,217) (25) (16) (48,648) (50,057)

Sale of treasury stock 51 28 1 207 60

Cancellation of treasury stock — 50,191 — — —

Balance at end of year (56,140) (5,946) (5,961) (54,402) (104,399)

Total balance at end of year 3,815,767 4,099,795 3,379,725 3,732,179 3,974,715

Non-controlling interests


Profit (loss) for the year attributable to non-controlling interests

23,770 20,434 16,496 20,014 22,823

Other comprehensive income for the year 11,746 12,255 (21,107) 2,118 (4,339)

Dividends paid to non-controlling interest shareholders

(18,981) (13,900) (18,387) (52,706) (24,098)


22,154 (5,747) 12,230 1,746 (8,961)


Total equity 4,100,304 4,397,374 3,666,536 3,990,162 4,218,123

Consolidated Statements of Changes in EquityMitsui & Co., Ltd. and its subsidiaries



Risk Information

Risk Factors

(1) Risks of Changes in Global Macroeconomic Factors

Our global business activities are affected by economic condi-

tions both globally and regionally. Among other locations, we are

particularly vulnerable to downward economic trends in Europe,

Japan, China, the U.S., and emerging countries. An economic

downturn may cause a reduction in the flow of goods and materi-

als, a decline in consumer spending and capital investment, and

subsequently a decline in demand from our customers for our

products and services, which may have an adverse impact on our

business, operating results, and financial condition.

(2) Market Risk

① Commodity Market Risk

We are engaged in the trade in and, as the case may be, the

production of a variety of commodities in the global commodi-

ties market including mineral resources and energy products.

Among others, operating results from our mineral resources and

energy producing activities account for a significant portion in

our overall operating results. These commodity markets can be

volatile in a short period or seasonally fluctuate by various factors

such as imbalance of supply and demand, economic fluctuation,

inventory adjustment, and exchange rate fluctuations. These

factors are beyond our control. The unexpected market fluctua-

tions may adversely affect our business, operating results, and

financial condition, as follows.

◦ At businesses such as mineral resources and/or energy

development projects, in which large amounts of investment

have been made, it may occur that the invested amount is not

recoverable through sales of the produced products due to

a fall in price, or we may have difficulty in divesting our

proprietary equity at a reasonable price.

◦ A decline in the value of our investments in LNG projects and

other investments which are recognized to designate as at fair

value through other comprehensive income (“FVTOCI”), could

adversely affect our operating results and financial condition

due to the decline of other comprehensive income.

◦ In trading of commodities or derivative instruments losses may

occur as a result of unexpected fluctuations.

◦ Fluctuations in a commodity market may cause a reduction of

trading transactions in which we act as a principal or an agent.

② Foreign Currency Risk

We are exposed to risk of exchange rate fluctuations and

exchange rate fluctuations may have an adverse effect on our

operating results. Although our reporting currency is the

Japanese yen, a significant portion of our business operations,

consolidated revenues, and operating expenses is denominated

in currencies other than the Japanese yen. As a result, apprecia-

tion or depreciation in the value of other currencies as compared

to the Japanese yen could result in material transactional gains or

losses. As most of revenues, costs of revenues, and selling, gen-

eral and administrative expenses incurred from regular business

activities at overseas subsidiaries and associated companies are

quoted in the U.S. dollar, the Australian dollar, the Brazilian real, or

other currencies, our profit for the year may be affected by the

fluctuations of these currencies and we are exposed to transla-

tion risk in our assets and liabilities denominated in foreign

currencies. In addition, exchange rate fluctuations may reduce

the value of investments in overseas subsidiaries and associated

companies as well as in FVTOCI, and adversely affect our accumu-

lated other comprehensive income.

③ Interest Rate Risk

We are exposed to risks associated with interest rate fluctuations,

which may affect our overall operational costs and the value of

our financial assets and liabilities, particularly our debt obliga-

tions from the capital markets and borrowings from financial

institutions, including ¥201.6 billion in short-term debt and

¥4,025.4 billion in long-term debt as of March 31, 2018. An

increase in interest rates, especially in Japan and the U.S., may

adversely affect our operating results.

④ Stock Price Risk

A significant portion of our investment portfolio consists of

marketable equity financial assets. At March 31, 2018, our mar-

ketable equity financial assets recognized to designate as FVTOCI

were carried at a fair value of ¥1,046.6 billion, representing 9.3%

of our total assets. While we periodically review our investment

portfolio, a decline in the equity securities market could nega-

tively impact the value of our investment portfolio and operating

results and financial condition due to the decline of other com-

prehensive income.

⑤ Risks Regarding Pension Cost and Projected Benefit

Obligations

Declines in the market value of domestic and foreign govern-

ment bonds, other debt securities, and marketable equity securi-

ties would reduce the value of our pension plan assets. A decline

in the value of our pension plan assets or an increase in our

unfunded defined benefit obligation could adversely affect our

operating results and financial condition due to the decline of

other comprehensive income and retained earnings.


(3) Credit Risks

We are exposed to large-scale counterparty credit risks, including

the following:

◦ While many of our customers purchase products and services

from us on credit, we may also provide financing programs or

debt guarantees for customers associated with sales contracts.

At March 31, 2018, our current trade receivables (less allow-

ance for doubtful receivables－current) were ¥1,766.0 billion,

representing 15.6% of our total assets. The balance of the

allowance for doubtful receivables－current for the year

ended March 31, 2018 was ¥8.6 billion.

◦ We engage in significant project financing activities as a lender

or guarantor whereby we assume repayment risk.

◦ We have counterparty payment risk from various derivative

transactions we enter into as part of our hedging activities.

It is not possible for our credit risk management policy to

eliminate risks completely relating to the deterioration of the

financial positions of our counterparties. Furthermore, factors

such as insolvencies among our customers caused by liquidity

crises, sudden falls in real estate market or stock market prices, or

increases in company bankruptcies may make it difficult for us to

collect receivables.

(4) Risks Regarding Impairment Loss on Fixed Assets

Assets for our own use and/or rental to third parties, such as

equipment and fixtures, land and buildings are exposed to

potential significant impairment losses due to the decline in the

value of these assets. The total of the carrying amounts of prop-

erty, plant and equipment, investment property, and intangible

assets was ¥2,092.1 billion, as of March 31, 2018. The carrying

amounts of assets for our own use and/or rental to third parties

are affected by certain factors, which are beyond our control such

as changes in price, sales volume, production volume, and cost

based on global or local supply and demand. When impairment

losses on these assets occur, impairment losses may have an

adverse effect on our operating results and financial condition.

(5) Risks Regarding Fund Procurement

Turmoil in financial markets, a downgrade in our credit ratings or

significant changes in the lending or investment policies of our

lenders or institutional investors could result in constraints on our

fund procurement and an increase in funding costs, and could

have an adverse effect on our financial position and liquidity.

(6) Risks Regarding Deferred Tax Assets

We determine the recoverability of deferred tax assets based on

all currently available information, including tax deductibility of

accounting losses, their timing as well as future taxable income at

Mitsui and the subsidiaries. Deferred tax assets are recognized

except for cases where such deferred tax assets are not recover-

able, while the amount of recoverable net deferred tax assets

may change if estimates of future taxable income are changed or

if tax laws and regulations including statutory tax rates are revised.

A worsening of our operating environment could negatively

affect our ability to achieve the goals set in our business plan, and

future taxable income may decrease compared to the amount

anticipated in the current tax planning strategies. In such cases,

decrease in deferred tax assets due to the changes in assessment

for recoverability of deferred tax assets may adversely affect our

operating results and financial conditions.

(7) Concentrated Risk Exposures

Various types of businesses worldwide sometimes expose us to

risks associated with regional political and economic instabilities,

in addition to aspects of the global economic environment such

as commodity market conditions, demand and supply for com-

modities, currency exchange rates, and interest rates.

Furthermore, some of our business activities may be exposed to

concentration risk in particular industries located in specific

regions or countries. For example:

◦ In Brazil, Chile and Russia, we have significant interests in the

exploration, development, and production of mineral

resources and energy.

◦ In Indonesia, we actively participate in infrastructure projects,

including the operation of power plants, and maintain a

nationwide motorcycle retail finance business.

◦ In Mozambique, we have significant interests in the rail and

port infrastructure business and the exploration, development,

and production of mineral resources.

As a result, declining levels of trading activities or asset vol-

umes in specific sectors or in certain regions or countries, or

unexpected political or economic instabilities could have a

disproportionately negative effect on our business, operating

results, and financial condition.

(8) Business Investment Risk

As of March 31, 2018, we had 265 consolidated subsidiaries and

207 equity accounted investees. We have been continuously

restructuring underperforming businesses of our consolidated

subsidiaries and associated companies using a process we have

introduced to assess their profitability. If we fail to successfully

restructure or eliminate our underperforming subsidiaries and

associated companies in a timely manner, or if these efforts fail to

improve our business operations as contemplated, our business

operations may become less efficient and our operating results

and financial condition may be adversely affected.

Furthermore, we participate in various businesses directly or

indirectly through joint ventures or by making strategic invest-

ments in other companies and business enterprises. The out-

come of these joint ventures and strategic investments is

unpredictable because:

◦ operational success is critically dependent on factors that are

beyond our control such as the financial condition and perfor-

mance of the partner companies or the strategic investees; or

◦ with respect to certain associated companies, we may be

unable to exercise adequate control over the management,

operations, and assets of the companies in which we invested

or may be unable to make major decisions without the con-

sent of other shareholders or participants due to lack of

common business goals and strategic objectives with our

alliance partners.

Any occurrence of these events could have an adverse effect

on our operating results and financial condition.


(9) Risks Regarding Exploration, Development, and Production of

Mineral Resources and Oil and Gas

Exploration, development, and production activities of mineral

resources and oil and gas projects are becoming more significant

to our operating results and financial condition. Mining and oil

and gas projects involve risks, as follows:

◦ development of projects may face schedule delays or cost

overruns than originally planned, due to difficulties in techni-

cal conditions, procurement of materials, financial conditions

and government regulations including environmental aspect;

◦ reserves are estimated based on available geological, techni-

cal, contractual and economic information, and thus actual

development and production may significantly differ from

originally estimated reserves; and

◦ exploration activities may not produce successful results and

thus it is possible that reserve replacement cannot be achieved

as per assumed cost and time schedule.

We participate as a non-operator in many of these projects.

Under these circumstances, we carefully consider the business

potential and profitability of projects based on the information

and data provided by operators, who have the discretion to control

operations of such projects, including decision-making for devel-

opment and production. In addition to the above-mentioned

risks, an operator’s failure in managing those projects may

adversely affect our operating results and financial condition.

(10) Risks Due to Competition

Products and services we provide are generally under competi-

tion. Other Japanese general trading companies as well as other

competitors which engage in similar business activities in various

fields may have stronger business associations and relationships

with our customers, suppliers, and business partners in both

domestic and global markets; or stronger global networks and

regional expertise, diversified global customer bases, greater

financial engineering skills, and market insights. Unless we can

successfully continue to meet the changing needs of our custom-

ers by providing them with innovative and integrated services in

a cost effective manner, we may lose our market share or rela-

tionships with our existing customers, and we may have an

adverse effect on our operating results and financial condition.

(11) Risk Regarding Limitation of Resources on Business

In new businesses, we are investing in human resources that are

capable of planning and evaluating business, executing projects,

and managing and supervising a workforce. However, in certain

business areas, we may have a shortage of required human

resources, which could cause a loss of opportunities to start new

businesses, which in turn may adversely affect our future busi-

ness, operating results, and financial condition.

(12) Environmental Risks

Various projects and business transactions worldwide we are

involved in are subject to extensive environmental laws and

regulations. In particular, the Mineral & Metal Resources Segment

and Energy Segment may be adversely affected by present or

future environmental regulations or enforcement in connection

with our exploration, development, and production activities. For

example, we are subject to complex sets of environmental

regulations in Australia, Brazil, Chile, Russia, and the Middle East.

These laws and regulations may require us to perform site clean-

ups; require us to curtail or cease certain operations; impose fines

and payments for significant environmental damage; require us

to install costly pollution control equipment; and require us to

modify our operations. Newly enacted environmental laws and

regulations or changes therein, criticism by stakeholders such

as NPOs & NGOs, advice from institutional shareholder service

providers and ratings by the ESG/SRI research company may

materially impact the progress of these projects. Once an

environmental accident occurs, as the owner of mineral resource

and energy interests, regardless of the degree of our contribution

to such accidents or acts of negligence, we may be imposed to

bear fines or payments for compensation from environmental

authorities or other concerned parties, even in situations

where we have no involvement at all in actual operations as

a non-operator. These fines and/or compensation payments

may include clean-up costs, compensation for environmental

damages, compensation for health hazards and/or property

damage to those affected by the accident, compensation for

absence from work, and/or for loss of earnings.

Risk Information


(13) Risks Associated with Laws and Regulations

Our business operations are subject to extensive laws and regula-

tions in Japan and other countries throughout the world. Our

operations are subject to laws and regulations governing, among

other things, commodities, consumer protection, business and

investment approvals, environmental protection, currency

exchange control, import and export (including restrictions from

the viewpoint of national and international security), taxation,

and antitrust. For instance, many of our infrastructure projects in

developing countries are subject to less developed legal systems.

As a result, our costs may increase due to factors such as the lack

of a comprehensive set of laws and regulations, an unpredictable

judicial system based on inconsistent application and interpreta-

tion of laws and regulations, and changing practices of regulatory

and administrative bodies. For example, we are subject to sudden

and unpredictable changes to: tariffs for products and services

that we provide; technical specifications with respect to environ-

mental regulations; income tax and duty rates; and foreign

currency exchange controls with respect to repatriation of invest-

ments and dividends.

Furthermore, while we are involved in the exploration, devel-

opment, and production activities through various contractual

arrangements for concessions, the contracts may not be honored

or extended when they expire. Moreover, the regulatory bodies

of these areas may unilaterally intervene or even alter the con-

tractual terms of our oil and gas as well as mineral resource

producing operations involving production rates, pricing formu-

las, royalties, environmental protection cost, land tenure, or

otherwise. If these regulatory bodies unilaterally alter such

contractual terms, or if the cost of complying with revised or

newly established laws and regulations increases, our business,

operating results, and financial condition could be adversely

affected. In order to comply with laws and regulations, we may

bear considerable additional costs.

(14) Risks Regarding Employees’ Compliance with Laws,

Regulations, and Internal Policies

Due to our size, as well as the operational and geographic

breadth of our activities, our day-to-day operations are necessar-

ily decentralized. As a result, we cannot fully ensure that our

employees comply with all applicable laws and regulations as

well as our internal policies. For example, our employees may

engage in unauthorized trading activities and exceed the allotted

market risk exposure for various commodities or extend an

unauthorized amount of credit to a client, which, in either case,

may result in unknown losses or unmanageable risks. Moreover,

our employees could engage in various unauthorized activities

prohibited under the laws of Japan or other jurisdictions to which

we are subject, including export regulations, anticorruption laws,

antitrust laws, and tax regulations. The efforts we undertake to

ensure employees’ compliance with applicable laws and regula-

tions as well as our internal policies may not succeed in prevent-

ing misconduct by our employees. Depending on its nature,

employees’ misconduct could have negative effects on our

operating results and reputation.

(15) Risks Regarding Internal Control

We are engaged in business activities in a variety of products and

services worldwide and thus our internal control over financial

reporting needs to be established for numerous transaction

patterns. We may be unable to maintain adequate internal

control over financial reporting, and thus not be able to assert

that our internal control over financial reporting is effective. This

could adversely affect the capital market’s perception of us and

may cause negative market reactions.

(16) Risks Regarding Climate Changes and Natural Disasters

Initiatives to reduce greenhouse gases, which are said to be the

root cause of climate change and global warming, are under-

taken globally, such as adoption and ratification of “Paris

Agreement” at the 21st Conference of Parties (COP21) in United

Nations’ U.N. Framework Convention on Climate Change.

We recognize the significance of Climate Change. Transition

risks related to transition to low carbon emission economy (Policy

and Legal Risks, Technology Risk, and Market Risk) and physical

risks resulting from climate change could adversely affect the

operating results of our businesses.

As transition risks related to policy and legal risks, the intro-

duction of government-imposed greenhouse gas emission

restrictions including imposition of carbon tax, and cap-and-trade

schemes of emissions credit could adversely affect the operating

results of our businesses that use fossil fuels and emit a large

amount of greenhouse gases, such as overseas power producing

businesses, and that produce coal, oil, and gas, where we have

minority share holdings.

As physical risks, among extreme weather conditions which

have been increasing recently due to climate change, intense

storms, especially hurricanes and cyclones, which are strong

tropical depressions in the Atlantic and South Pacific oceans,

respectively, may have an adverse impact on production and

shipments of our mineral resources, oil and gas, and salt produc-

tion operations, leading to increased costs and/or decreased

revenues. In the case that production sites, production facilities,

and infrastructure used for shipments such as roads, railways, and

ports are seriously damaged by extreme weather conditions,

operations and shipments could stop for indeterminate periods

until restoration work is completed. Extreme weather conditions

such as drought could also adversely affect foods raw material

producing activities in which we have investments.

Furthermore, natural disasters, such as earthquakes, heavy rain

or floods, that affect our employees and damage our offices or

facilities, may adversely hinder our business. We have imple-

mented measures such as developing a disaster contingency

manual, creating a Business Continuity Plan (BCP), introducing a

safety confirmation system for employees, reinforcing earth-

quake resistance, and conducting emergency drills. However,

despite these measures, there is no assurance that damage from

disasters can be completely avoided.


(17) Risks Regarding Information Systems and Information

Securities

As for the worldwide operation of our global communication

network, it is important to properly operate the IT system, grasp

information value, and handle it properly. We enhance the safety

and security of information systems by internal control through

development of related regulations to secure properly confiden-

tiality, integrity, and availability on information and information

systems for us and our consolidated subsidiaries. We reduce

risks on data breaches by improved guidelines for better risk

management, and tackle external threats with various measures,

including the security monitoring of our IT networks. However,

we cannot eliminate all the possibilities of distraction or leakages

of confidential business information triggered by unexpected

serious IT system troubles, and unforeseeable threats against

our IT system infrastructure or communications networks. Such

situations could seriously reduce our operational efficiency or

jeopardize our ability to maintain or expand our business activi-

ties, which may have an adverse impact on our business, operat-

ing results and financial condition.

(18) Risks Relating to Terrorists and Violent Groups

We conduct business operations globally, and these conditions

are therefore exposed to risk from unexpected situations relating

to terrorists and violent groups, as well as trends in politics and

social factors. The materialization of such risks may have an

adverse impact on our business, operating results and financial

condition.

(19) Possibility of Difference between the Actual Dividend

Amount and the Forecasts Announced Prior to the Record

Date

The customary dividend payout practice of publicly listed compa-

nies in Japan may significantly differ from the practice widely

followed in other markets. Our dividend payout practice is no

exception.

We ordinarily announce a certain dividend payout policy at the

beginning of each fiscal year and also provide guidance for

annual dividends based on the forecast of our financial results

including profit for the year. Interim dividends are paid to share-

holders of record on September 30 of each fiscal year after

reviewing our financial results during the first six months of each

fiscal year as well as our forecast of our financial results during

the last six months of the same fiscal year. The decision of decla-

ration and payment is solely a matter of discretion of our Board of

Directors, and such a decision may be made after the September

30 record date, and thus may differ from our guidance provided

prior to such record date.

The amount and payment of the year-end dividend are deter-

mined by our Board of Directors based on the actual financial

results including profit for the year. It also requires the approval of

shareholders at the annual general meeting held in June of each

year, if we propose to declare the year-end dividend. Our Board of

Directors decides and submits a proposal for the year-end divi-

dend declaration a few weeks before the annual general meet-

ing. If the shareholders’ approval is given, dividend payments are

made to shareholders of record.

The shareholders of record may sell shares after the March 31

record date with the anticipation of receiving a certain dividend

payment. However, the declaration of year-end dividends is

approved by our shareholders only in June, usually based upon a

proposal submitted by our Board of Directors. As such, we may

have announced dividend-related forecasts prior to the record

date; but, in making a decision on the year-end dividend declara-

tion, neither our shareholders nor our Board of Directors is legally

bound by such forecast. Moreover, where our profit for the year

turns out to be lower than we originally forecast, we may not

submit any year-end dividend proposal to the annual general

meeting of shareholders.

(20) Possibility of Restriction to Sell Our Common Stock Because

of Daily Price Range Limitations under Japanese Stock

Exchange Rules

Stock prices on Japanese stock exchanges are determined on a

real-time basis by the equilibrium between bids and offers. These

exchanges are order-driven markets without specialists or market

makers to guide price formation. To prevent excessive volatility,

these exchanges set daily upward and downward price range

limitations for each stock, based on the previous day’s closing

price. Although transactions may continue at the upward or

downward limit price if the limit price is reached on a particular

trading day, no transactions may take place outside these limits

on these exchanges. Consequently, an investor wishing to sell at

a price above or below the relevant daily limit on these

exchanges may not be able to effect a sale at such price on a

particular trading day, or at all.

(21) Necessity of Depositary to Exercise the Rights of

Shareholders

The rights of shareholders under Japanese law to take actions,

including exercising voting rights, receiving dividends and

distributions, bringing derivative actions, examining our account-

ing books and records and exercising appraisal rights are avail-

able only to holders recorded on our register of shareholders.

Because the depositary, through its custodian agents, is the

recorded holder of the shares underlying the ADSs, only the

depositary can exercise those rights in connection with the

deposited shares. The depositary will make efforts to vote the

shares underlying your ADSs as instructed by you and will pay to

you the dividends and distributions collected from us. However,

as ADS holders, you will not be able to bring a derivative action,

examine our accounting books and records or exercise appraisal

rights except through and with the consent of the depositary.

Risk Information


Risk Management

(1) Credit Risk

With regard to the contingent characteristics of credit risks

included in derivative instruments, some of the derivative instru-

ments used by the Company and certain subsidiaries such as

commodity futures, commodity forwards, commodity swaps, and

commodity options may include clauses that prescribe changes

in the minimum required collateral (margins) or early termina-

tion in accordance with the credit ratings of the Company. If the

credit ratings of the Company are downgraded, the counterparty

will require additional collateral from the Company and certain

subsidiaries to cover the whole or part of the amount of the

relevant derivative obligations in accordance with such clauses.

Concentration of credit risk in specific regions or customers is

minimized as the companies carry out a wide variety of transac-

tions with various customers all over the world. The companies

also minimize credit risks of derivative instruments associated

with, for example, counterparty defaults by entering into these

transactions mainly with reputable international financial institu-

tions with high credit ratings. Therefore, the companies believe

that a significant loss arising from these transactions is extremely

unlikely. The companies manage credit risks through the man-

agement of commitment lines of credit approved by an executive

officer and through counterparty monitoring conducted on an

ongoing basis. In addition, the companies require collateral and/

or other forms of security from counterparties as necessary.

(2) Liquidity Risk

Turmoil in financial markets, a downgrade in our credit ratings or

significant changes in the lender or investment policies of our

lenders or institutional investors could result in constraints on our

fund procurement and an increase in funding costs, and could

have an adverse effect on our financial position and liquidity. The

companies secure the liquidity required for our smooth opera-

tions and maintain the strength and soundness of our balance

sheet by holding sufficient cash and cash equivalents, maintain-

ing lines of credit with banks, procuring mainly long-term funds,

utilizing financing programs provided by government financing

agencies and/or project financing and such so that the compa-

nies decrease liquidity risk. The unused lines of credit that the

companies can access to meet liquidity needs as of March 31,

2018 and 2017 were ¥1,237,812 million and ¥1,107,863 million,

respectively.

(3) Market Risks

The Companies are subject to market risks associated with

fluctuations in interest rates, foreign currency exchange rates,

commodity prices, and stock prices that arise in the course of the

Company’s operating and other activities.

The Companies have formulated market risk management

policies and have established management systems at several

levels. In particular, regarding foreign currency exchange risks

and commodity price risks, Chief Operating Officers have the

primary responsibility of establishing risk management policies

that prescribe the setting of limits on positions and losses, as well

as prescribing management systems at each business unit. They

also have the responsibility of obtaining the approval of our

executive officers in charge of risk management, and carrying out

management and reporting in accordance with such approval. In

addition, risk management sections, which are independent

from trading sections, monitor, analyze and evaluate market risks

and periodically report to the executive officers in charge.

Regarding interest rate risks, the environment surrounding

financial markets, the Companies’ ratio of assets and liabilities,

and the risks of interest rate fluctuations are regularly reported to

the executive officers, by whom the risk management policies for

interest rate were approved. Stock price risk is managed by

analyzing factors of stock price fluctuations.

① Interest Rate Risk

The Companies are exposed to interest rate risk arising from

floating-rate assets and liabilities. An increase in interest rates

may adversely affect the operating results. The Companies have

entered into interest rate derivative transactions which consist

mainly of interest rate swap agreements and interest rate and

currency swap agreements to hedge exposures of certain assets

and liabilities.

The impacts on profit before income taxes for the fiscal years

ended March 31, 2018 and 2017, assuming a 100 basis point rise

in interest rates as of March 31, 2018 and 2017, were ¥(24,686)

million and ¥(28,353) million, respectively. These are calculated

by multiplying the balance of floating-rate financial instruments

held by the Companies as of March 31, 2018 and 2017 by 100

basis points without considering future changes in the balance,

the effect of exchange rate fluctuations, the diversification effect

of the timing of refinancing/interest rate revisions of floating-rate

debts, etc., and assuming that all other variables are constant. The

items that are considered to be instruments affected by interest

rate fluctuations for the purpose of calculating the sensitivity

include floating-rate interest-bearing debts/loans, fixed-rate

interest-bearing debts/loans that are effectively converted to

floating-rate instruments under interest rate swap agreements,

deposits, and other instruments.


② Foreign Currency Exchange Rate Risk

The Companies are exposed to foreign currency exchange rate

risk on receivables and payables denominated in foreign curren-

cies arising from transactions such as purchases and sales of

commodities and financial transactions. The Companies hedge

these risks with forward exchange contracts and currency swaps.

For significant long and short net positions denominated in

foreign currencies as of March 31, 2018 and 2017, assuming a 1%

appreciation of the Japanese yen, the impacts on profit before

income taxes would have been ¥(1,101) million from USD, ¥(17)

million from BRL, and ¥(23) million from AUD as of March 31,

2018 and ¥(612) million from USD, ¥(37) million from BRL, and

¥59 million from AUD as of March 31, 2017. Based on the same

assumption, the impacts on other comprehensive income would

be ¥(245) million from USD and ¥(3,884) million from BRL, as of

March 31, 2018 and ¥(260) million from USD as of March 31,

2017. The increase of impact on other comprehensive income

from BRL is due to the Company’s acquisition of Vale shares

resulted from the incorporation in Valepar by Vale. The long and

short positions denominated in foreign currencies indicate that

they are in currencies other than that of the functional currency of

each company. In this context, the long positions represent the

condition in which certain losses occur due to a decline in the

value of the currency, and the short positions represent the

condition in which certain gains occur due to an increase in the

value of the currency. Foreign currency translation adjustments

are not included in the scope of this analysis. In addition, this

analysis assumes that all other variables are constant.

③ Commodity Price Risk

As the Companies carry out business activities pertaining to

commodities such as non-ferrous metals, crude oil and gas, and

foods, they are exposed to risks associated with commodity

prices.

The Companies measure the risk of market commodities for

which historical price fluctuations have been relatively significant

along with actively traded derivatives by using Value at Risk (VaR),

which is a statistical measure of the potential maximum loss in

the fair value of a given portfolio over a certain holding period

and within a certain confidential level. VaR is calculated by mainly

using a 10-day holding period and a confidence level of 99%. In

addition, the figures do not necessarily take into account correla-

tions between all commodities. VaRs as of March 31, 2018 and

2017 were ¥6,604 million and ¥10,445 million, respectively. The

actual results may differ significantly from VaR above as VaR is

calculated by using historical fluctuations of each risk

component.

④ Stock Price Risk

The Companies invest in listed companies to strengthen ties with

customers, suppliers and others, as well as to make various types

of propositions to the companies in which the Companies invest,

to pursue operating revenue. These investments are exposed to

stock price risks.

For investments held as of March 31, 2018 and 2017, the

impacts on other comprehensive income arising from changes in

the fair values assuming a 10% change in the stock index repre-

sentative of the markets on which the individual stocks are traded

were ¥97,061 million and ¥52,203 million, respectively. The

impact on profit before taxes is immaterial.


Investments, Loans, and Guarantees (As of March 31, 2018)

(Sum of Mitsui & Co., Ltd., Trading Subsidiaries, and some investment vehicles and subsidiaries)

Billions of yen

Investments Loans Guarantees TotalHedged

(ex. Insurance)Net Position

Brazil 792.7 62.2 206.3 1,061.2 63.9 997.3

Chile 13.7 33.0 265.6 312.3 0.0 312.3

Mozambique 121.9 0.0 155.0 276.9 0.0 276.9

Italy 61.6 0.0 129.8 191.4 0.0 191.4

Indonesia 119.6 2.4 50.0 172.0 7.7 164.3

Malaysia 129.3 0.0 17.7 147.0 0.0 147.0

China 129.5 0.4 4.7 134.6 0.2 134.4

Mexico 68.8 0.0 47.7 116.5 0.1 116.4

Thailand 68.8 0.7 44.5 114.0 0.4 113.6

Russia 103.0 0.0 2.8 105.8 0.0 105.8

Qatar 100.8 0.0 2.3 103.1 0.0 103.1

India 26.0 0.6 17.4 44.0 0.0 44.0

Notes: 1. Among the countries subject to country risk reporting, we disclose countries with significance as to the balance.

2. “Hedged” represents the amounts by which credit risk is hedged by such as investment insurance and third-party guarantees.

3. “Investment” represents book value for accounting purposes on the basis of Japanese GAAP, not reflecting the effects of applying net investment hedging

relationships.

4. From the fiscal year ended March 31, 2018, the balance of “China” in the above table includes Hong Kong.

Trade Receivables (As of March 31, 2018)

(Sum of Mitsui & Co., Ltd., Trading Subsidiaries, and some investment vehicles and subsidiaries)

Billions of yen

GrossHedged

(ex. Insurance)Net Position

Brazil 21.4 0.9 20.5

Chile 14.8 0.3 14.5

Mozambique 0.2 0.0 0.2

Italy 17.6 2.2 15.4

Indonesia 22.5 0.1 22.4

Malaysia 12.4 0.2 12.2

China 223.1 4.8 218.3

Mexico 8.0 1.1 6.9

Thailand 38.2 1.5 36.7

Russia 1.4 0.0 1.4

Qatar 1.3 0.0 1.3

India 39.1 3.8 35.3

5. Among the countries subject to country risk reporting, we disclose countries with significance as to the balance.

6. “Hedged” represents the amounts by which credit risk is hedged by such as trade insurance and Confirmed L/C.

7. From the fiscal year ended March 31, 2018, the balance of “China” in the above table includes Hong Kong.

Major Risk Exposure by Country and Fund Operation


Investor Information

As of April 1, 2018

Securities Identification Code

8031

Stock Exchange Listings

Tokyo, Nagoya, Sapporo, Fukuoka

Fiscal Year

From April 1 to March 31

General Shareholders’ Meeting

June

Administrator of the Register of Shareholders

Sumitomo Mitsui Trust Bank, Limited

4-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo

100-0005

Contact Information for Above

Sumitomo Mitsui Trust Bank, Limited

Stock Transfer Agency Business Planning Department

8-4, Izumi 2-chome, Suginami-ku, Tokyo 168-0063

American Depository Receipts

Ratio: 1ADR = 20 common shares

Exchange: OTC (Over-the-Counter)

Symbol: MITSY

CUSIP Number: 606827202

Depository and Registrar

Citibank, N.A. Shareholder Services

P.O. Box 43077, Providence,

Rhode Island 02940-3077, U.S.A.

Tel: 1-877-248-4237 (Toll free in the U.S.)

1-781-575-4555 (Overseas Dial-In)

E-mail: [email protected]

URL: www.citi.com/adr

As of March 31, 2018

Unit Share

100 shares

Number of Shareholders

319,600 shareholders

Number of Shares Issued

1,796,514,127 shares

(including 58,602,512 treasury shares)

Number of Shares Authorized

2,500,000,000 shares

Major Shareholders

The Master Trust Bank of Japan, Ltd. (trust account)

Japan Trustee Services Bank, Ltd. (trust account)

Japan Trustee Services Bank, Ltd. (trust account 9)

Nippon Life Insurance Company


STATE STREET BANK WEST CLIENT – TREATY 505234

Sumitomo Mitsui Banking Corporation




Individuals and others Government / Regional public bodies

Financial institutions Securities firms

Other corporate shareholders Foreign shareholders

Note: The figures in the above graph reflect all shareholders and shares held

but exclude shareholders who own less than one trading unit.

Composition of Shareholders(%)

Mar. 2017

Mar. 2018

Mar. 2016

Mar. 2015

Mar. 2014

25.70 36.720.00 4.08 4.92 28.55

26.05 37.070.00 3.92 4.86 28.08

24.03 36.120.00 4.10 5.15 30.60

30.64 37.320.00 4.07 5.07 22.90

20.61 37.480.00 3.97 5.04 32.90


Mitsui & Co., Ltd.As of March 31, 2018

Trade Name MITSUI & CO., LTD.

Date of Establishment July 25, 1947

Common Stock ¥341,481,648,946

Number of Employees The Company and subsidiaries: 42,304

Non-consolidated: 5,859

Number of Affiliated

Companies for Consolidation Subsidiaries: 265

Equity accounted investees: 207

Address 1-3, Marunouchi 1-chome, Chiyoda-ku,

Tokyo 100-8631, Japan

(registered head office location)

Nippon Life Marunouchi Garden Tower

JA Building, 3-1, Ohtemachi 1-chome,

Chiyoda-ku, Tokyo 100-8631, Japan

Tel: 81 (3) 3285-1111

Facsimile: 81 (3) 3285-9819

URL: https://www.mitsui.com/jp/en/

Corporate site

https://www.mitsui.com/jp/

en/index.html

IR site


en/ir/index.html

Sustainability site


en/sustainability/index.html

MITSUI & CO., LTD.

Printed in Japan

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annual report 2018 - mitsui · publication of an integrated report in 2004, mitsui systematically...

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